Correlation Between Refex Industries and V Mart
Can any of the company-specific risk be diversified away by investing in both Refex Industries and V Mart 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 V Mart 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 V Mart Retail Limited, you can compare the effects of market volatilities on Refex Industries and V 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 Refex Industries with a short position of V Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Refex Industries and V Mart.
Diversification Opportunities for Refex Industries and V Mart
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Refex and VMART is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Refex Industries Limited and V Mart Retail Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on V Mart Retail 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 V Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of V Mart Retail has no effect on the direction of Refex Industries i.e., Refex Industries and V Mart go up and down completely randomly.
Pair Corralation between Refex Industries and V Mart
Assuming the 90 days trading horizon Refex Industries Limited is expected to generate 1.44 times more return on investment than V Mart. However, Refex Industries is 1.44 times more volatile than V Mart Retail Limited. It trades about 0.1 of its potential returns per unit of risk. V Mart Retail Limited is currently generating about 0.09 per unit of risk. If you would invest 47,165 in Refex Industries Limited on September 27, 2024 and sell it today you would earn a total of 2,325 from holding Refex Industries Limited or generate 4.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Refex Industries Limited vs. V Mart Retail Limited
Performance |
| Timeline |
| Refex Industries |
| V Mart Retail |
Refex Industries and V Mart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Refex Industries and V Mart
The main advantage of trading using opposite Refex Industries and V Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Refex Industries position performs unexpectedly, V 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 V Mart will offset losses from the drop in V Mart's long position.| Refex Industries vs. Digjam Limited | Refex Industries vs. Gujarat Raffia Industries | Refex Industries vs. Xelpmoc Design And | Refex Industries vs. Dynamatic Technologies Limited |
| V Mart vs. Melstar Information Technologies | V Mart vs. Consolidated Construction Consortium | V Mart vs. Biofil Chemicals Pharmaceuticals | V Mart vs. Refex Industries 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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