Correlation Between REC and Procter Gamble
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By analyzing existing cross correlation between REC Limited and Procter Gamble Health, you can compare the effects of market volatilities on REC and Procter Gamble 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 REC with a short position of Procter Gamble. Check out your portfolio center. Please also check ongoing floating volatility patterns of REC and Procter Gamble.
Diversification Opportunities for REC and Procter Gamble
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between REC and Procter is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding REC Limited and Procter Gamble Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Procter Gamble Health and REC 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 REC Limited are associated (or correlated) with Procter Gamble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Procter Gamble Health has no effect on the direction of REC i.e., REC and Procter Gamble go up and down completely randomly.
Pair Corralation between REC and Procter Gamble
Assuming the 90 days trading horizon REC Limited is expected to generate 1.91 times more return on investment than Procter Gamble. However, REC is 1.91 times more volatile than Procter Gamble Health. It trades about 0.13 of its potential returns per unit of risk. Procter Gamble Health is currently generating about 0.05 per unit of risk. If you would invest 10,132 in REC Limited on September 4, 2024 and sell it today you would earn a total of 43,838 from holding REC Limited or generate 432.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
REC Limited vs. Procter Gamble Health
Performance |
| Timeline |
| REC Limited |
| Procter Gamble Health |
REC and Procter Gamble Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REC and Procter Gamble
The main advantage of trading using opposite REC and Procter Gamble positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REC position performs unexpectedly, Procter Gamble 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 Procter Gamble will offset losses from the drop in Procter Gamble's long position.| REC vs. Procter Gamble Health | REC vs. Orient Technologies Limited | REC vs. GPT Healthcare | REC vs. Landmark Cars Limited |
| Procter Gamble vs. EMBASSY OFFICE PARKS | Procter Gamble vs. Yatra Online Limited | Procter Gamble vs. V Mart Retail Limited | Procter Gamble vs. Varun Beverages Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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