Correlation Between Praxis Home and Salzer Electronics
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By analyzing existing cross correlation between Praxis Home Retail and Salzer Electronics Limited, you can compare the effects of market volatilities on Praxis Home and Salzer Electronics 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 Salzer Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praxis Home and Salzer Electronics.
Diversification Opportunities for Praxis Home and Salzer Electronics
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Praxis and Salzer is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Praxis Home Retail and Salzer Electronics Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salzer Electronics 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 Salzer Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salzer Electronics has no effect on the direction of Praxis Home i.e., Praxis Home and Salzer Electronics go up and down completely randomly.
Pair Corralation between Praxis Home and Salzer Electronics
Assuming the 90 days trading horizon Praxis Home Retail is expected to under-perform the Salzer Electronics. But the stock apears to be less risky and, when comparing its historical volatility, Praxis Home Retail is 4.13 times less risky than Salzer Electronics. The stock trades about -1.48 of its potential returns per unit of risk. The Salzer Electronics Limited is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest 154,060 in Salzer Electronics Limited on November 9, 2024 and sell it today you would lose (34,575) from holding Salzer Electronics Limited or give up 22.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Praxis Home Retail vs. Salzer Electronics Limited
Performance |
| Timeline |
| Praxis Home Retail |
| Salzer Electronics |
Praxis Home and Salzer Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Praxis Home and Salzer Electronics
The main advantage of trading using opposite Praxis Home and Salzer Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praxis Home position performs unexpectedly, Salzer Electronics 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 Salzer Electronics will offset losses from the drop in Salzer Electronics' long position.| Praxis Home vs. Jindal Poly Investment | Praxis Home vs. Tata Investment | Praxis Home vs. Electronics Mart India | Praxis Home vs. SIL Investments Limited |
| Salzer Electronics vs. SIL Investments Limited | Salzer Electronics vs. Dharani SugarsChemicals Limited | Salzer Electronics vs. Kalyani Investment | Salzer Electronics vs. JB Chemicals Pharmaceuticals |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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