Correlation Between Praxis Home and Parag Milk
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By analyzing existing cross correlation between Praxis Home Retail and Parag Milk Foods, you can compare the effects of market volatilities on Praxis Home and Parag Milk 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 Parag Milk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praxis Home and Parag Milk.
Diversification Opportunities for Praxis Home and Parag Milk
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Praxis and Parag is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Praxis Home Retail and Parag Milk Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parag Milk Foods 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 Parag Milk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parag Milk Foods has no effect on the direction of Praxis Home i.e., Praxis Home and Parag Milk go up and down completely randomly.
Pair Corralation between Praxis Home and Parag Milk
Assuming the 90 days trading horizon Praxis Home is expected to generate 5.02 times less return on investment than Parag Milk. In addition to that, Praxis Home is 1.18 times more volatile than Parag Milk Foods. It trades about 0.01 of its total potential returns per unit of risk. Parag Milk Foods is currently generating about 0.06 per unit of volatility. If you would invest 9,994 in Parag Milk Foods on October 11, 2024 and sell it today you would earn a total of 8,473 from holding Parag Milk Foods or generate 84.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Praxis Home Retail vs. Parag Milk Foods
Performance |
| Timeline |
| Praxis Home Retail |
| Parag Milk Foods |
Praxis Home and Parag Milk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Praxis Home and Parag Milk
The main advantage of trading using opposite Praxis Home and Parag Milk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praxis Home position performs unexpectedly, Parag Milk 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 Parag Milk will offset losses from the drop in Parag Milk's long position.| Praxis Home vs. UltraTech Cement Limited | Praxis Home vs. UFO Moviez India | Praxis Home vs. Agro Tech Foods | Praxis Home vs. Tree House Education |
| Parag Milk vs. Praxis Home Retail | Parag Milk vs. Associated Alcohols Breweries | Parag Milk vs. Embassy Office Parks | Parag Milk vs. Allied Blenders Distillers |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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