Correlation Between Salzer Electronics and Industrial Investment
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By analyzing existing cross correlation between Salzer Electronics Limited and Industrial Investment Trust, you can compare the effects of market volatilities on Salzer Electronics and Industrial Investment 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 Salzer Electronics with a short position of Industrial Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salzer Electronics and Industrial Investment.
Diversification Opportunities for Salzer Electronics and Industrial Investment
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Salzer and Industrial is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Salzer Electronics Limited and Industrial Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Investment and Salzer Electronics 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 Salzer Electronics Limited are associated (or correlated) with Industrial Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Investment has no effect on the direction of Salzer Electronics i.e., Salzer Electronics and Industrial Investment go up and down completely randomly.
Pair Corralation between Salzer Electronics and Industrial Investment
Assuming the 90 days trading horizon Salzer Electronics Limited is expected to generate 1.44 times more return on investment than Industrial Investment. However, Salzer Electronics is 1.44 times more volatile than Industrial Investment Trust. It trades about 0.23 of its potential returns per unit of risk. Industrial Investment Trust is currently generating about -0.55 per unit of risk. If you would invest 129,955 in Salzer Electronics Limited on October 11, 2024 and sell it today you would earn a total of 24,105 from holding Salzer Electronics Limited or generate 18.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salzer Electronics Limited vs. Industrial Investment Trust
Performance |
| Timeline |
| Salzer Electronics |
| Industrial Investment |
Salzer Electronics and Industrial Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salzer Electronics and Industrial Investment
The main advantage of trading using opposite Salzer Electronics and Industrial Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salzer Electronics position performs unexpectedly, Industrial Investment 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 Industrial Investment will offset losses from the drop in Industrial Investment's long position.| Salzer Electronics vs. Manaksia Coated Metals | Salzer Electronics vs. NRB Industrial Bearings | Salzer Electronics vs. Hindustan Foods Limited | Salzer Electronics vs. Hisar Metal Industries |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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