Correlation Between Praxis Home and Electronics Mart
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By analyzing existing cross correlation between Praxis Home Retail and Electronics Mart India, you can compare the effects of market volatilities on Praxis Home and Electronics Mart and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Praxis Home with a short position of Electronics Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praxis Home and Electronics Mart.
Diversification Opportunities for Praxis Home and Electronics Mart
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Praxis and Electronics is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Praxis Home Retail and Electronics Mart India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronics Mart India and Praxis Home is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Praxis Home Retail are associated (or correlated) with Electronics Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronics Mart India has no effect on the direction of Praxis Home i.e., Praxis Home and Electronics Mart go up and down completely randomly.
Pair Corralation between Praxis Home and Electronics Mart
Assuming the 90 days trading horizon Praxis Home Retail is expected to generate 1.74 times more return on investment than Electronics Mart. However, Praxis Home is 1.74 times more volatile than Electronics Mart India. It trades about 0.0 of its potential returns per unit of risk. Electronics Mart India is currently generating about -0.49 per unit of risk. If you would invest 2,096 in Praxis Home Retail on October 17, 2024 and sell it today you would lose (22.00) from holding Praxis Home Retail or give up 1.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Praxis Home Retail vs. Electronics Mart India
Performance |
| Timeline |
| Praxis Home Retail |
| Electronics Mart India |
Praxis Home and Electronics Mart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Praxis Home and Electronics Mart
The main advantage of trading using opposite Praxis Home and Electronics Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praxis Home position performs unexpectedly, Electronics Mart can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Electronics Mart will offset losses from the drop in Electronics Mart's long position.| Praxis Home vs. Spencers Retail Limited | Praxis Home vs. Univa Foods Limited | Praxis Home vs. Silgo Retail Limited | Praxis Home vs. Future Retail Limited |
| Electronics Mart vs. GM Breweries Limited | Electronics Mart vs. Praxis Home Retail | Electronics Mart vs. Embassy Office Parks | Electronics Mart vs. Zee Entertainment Enterprises |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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