Correlation Between SAL Steel and State Bank
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By analyzing existing cross correlation between SAL Steel Limited and State Bank of, you can compare the effects of market volatilities on SAL Steel and State Bank 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 SAL Steel with a short position of State Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAL Steel and State Bank.
Diversification Opportunities for SAL Steel and State Bank
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SAL and State is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding SAL Steel Limited and State Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Bank and SAL Steel 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 SAL Steel Limited are associated (or correlated) with State Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Bank has no effect on the direction of SAL Steel i.e., SAL Steel and State Bank go up and down completely randomly.
Pair Corralation between SAL Steel and State Bank
Assuming the 90 days trading horizon SAL Steel Limited is expected to under-perform the State Bank. In addition to that, SAL Steel is 1.94 times more volatile than State Bank of. It trades about -0.04 of its total potential returns per unit of risk. State Bank of is currently generating about -0.05 per unit of volatility. If you would invest 79,205 in State Bank of on October 26, 2024 and sell it today you would lose (4,615) from holding State Bank of or give up 5.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SAL Steel Limited vs. State Bank of
Performance |
| Timeline |
| SAL Steel Limited |
| State Bank |
SAL Steel and State Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAL Steel and State Bank
The main advantage of trading using opposite SAL Steel and State Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAL Steel position performs unexpectedly, State Bank 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 State Bank will offset losses from the drop in State Bank's long position.| SAL Steel vs. Paramount Communications Limited | SAL Steel vs. Jindal Drilling And | SAL Steel vs. Can Fin Homes | SAL Steel vs. Embassy Office Parks |
| State Bank vs. JSW Steel Limited | State Bank vs. Sunflag Iron And | State Bank vs. SAL Steel Limited | State Bank vs. Visa Steel 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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