Correlation Between Rico Auto and GTL
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By analyzing existing cross correlation between Rico Auto Industries and GTL Limited, you can compare the effects of market volatilities on Rico Auto and GTL 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 Rico Auto with a short position of GTL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rico Auto and GTL.
Diversification Opportunities for Rico Auto and GTL
Poor diversification
The 3 months correlation between Rico and GTL is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Rico Auto Industries and GTL Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GTL Limited and Rico Auto 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 Rico Auto Industries are associated (or correlated) with GTL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GTL Limited has no effect on the direction of Rico Auto i.e., Rico Auto and GTL go up and down completely randomly.
Pair Corralation between Rico Auto and GTL
Assuming the 90 days trading horizon Rico Auto is expected to generate 1.97 times less return on investment than GTL. But when comparing it to its historical volatility, Rico Auto Industries is 1.26 times less risky than GTL. It trades about 0.02 of its potential returns per unit of risk. GTL Limited is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 875.00 in GTL Limited on August 30, 2024 and sell it today you would earn a total of 420.00 from holding GTL Limited or generate 48.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.39% |
| Values | Daily Returns |
Rico Auto Industries vs. GTL Limited
Performance |
| Timeline |
| Rico Auto Industries |
| GTL Limited |
Rico Auto and GTL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rico Auto and GTL
The main advantage of trading using opposite Rico Auto and GTL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rico Auto position performs unexpectedly, GTL 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 GTL will offset losses from the drop in GTL's long position.| Rico Auto vs. LLOYDS METALS AND | Rico Auto vs. Sarthak Metals Limited | Rico Auto vs. Indian Metals Ferro | Rico Auto vs. Metalyst Forgings Limited |
| GTL vs. SINCLAIRS HOTELS ORD | GTL vs. Usha Martin Education | GTL vs. Global Education Limited | GTL vs. G Tec Jainx Education |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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