Correlation Between Refex Industries and Pritish Nandy
Can any of the company-specific risk be diversified away by investing in both Refex Industries and Pritish Nandy at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Refex Industries and Pritish Nandy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Refex Industries Limited and Pritish Nandy Communications, you can compare the effects of market volatilities on Refex Industries and Pritish Nandy 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 Refex Industries with a short position of Pritish Nandy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Refex Industries and Pritish Nandy.
Diversification Opportunities for Refex Industries and Pritish Nandy
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Refex and Pritish is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Refex Industries Limited and Pritish Nandy Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pritish Nandy Commun and Refex Industries 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 Refex Industries Limited are associated (or correlated) with Pritish Nandy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pritish Nandy Commun has no effect on the direction of Refex Industries i.e., Refex Industries and Pritish Nandy go up and down completely randomly.
Pair Corralation between Refex Industries and Pritish Nandy
Assuming the 90 days trading horizon Refex Industries Limited is expected to generate 1.08 times more return on investment than Pritish Nandy. However, Refex Industries is 1.08 times more volatile than Pritish Nandy Communications. It trades about 0.13 of its potential returns per unit of risk. Pritish Nandy Communications is currently generating about 0.04 per unit of risk. If you would invest 5,502 in Refex Industries Limited on August 30, 2024 and sell it today you would earn a total of 41,568 from holding Refex Industries Limited or generate 755.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.18% |
| Values | Daily Returns |
Refex Industries Limited vs. Pritish Nandy Communications
Performance |
| Timeline |
| Refex Industries |
| Pritish Nandy Commun |
Refex Industries and Pritish Nandy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Refex Industries and Pritish Nandy
The main advantage of trading using opposite Refex Industries and Pritish Nandy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Refex Industries position performs unexpectedly, Pritish Nandy 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 Pritish Nandy will offset losses from the drop in Pritish Nandy's long position.| Refex Industries vs. Manaksia Coated Metals | Refex Industries vs. Styrenix Performance Materials | Refex Industries vs. Mangalam Drugs And | Refex Industries vs. Akums Drugs and |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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