Correlation Between SBI Cards and Indian Railway
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By analyzing existing cross correlation between SBI Cards and and Indian Railway Finance, you can compare the effects of market volatilities on SBI Cards and Indian Railway 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 SBI Cards with a short position of Indian Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Cards and Indian Railway.
Diversification Opportunities for SBI Cards and Indian Railway
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SBI and Indian is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding SBI Cards and and Indian Railway Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indian Railway Finance and SBI Cards 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 SBI Cards and are associated (or correlated) with Indian Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indian Railway Finance has no effect on the direction of SBI Cards i.e., SBI Cards and Indian Railway go up and down completely randomly.
Pair Corralation between SBI Cards and Indian Railway
Assuming the 90 days trading horizon SBI Cards and is expected to generate 0.47 times more return on investment than Indian Railway. However, SBI Cards and is 2.12 times less risky than Indian Railway. It trades about 0.04 of its potential returns per unit of risk. Indian Railway Finance is currently generating about -0.09 per unit of risk. If you would invest 69,480 in SBI Cards and on September 2, 2024 and sell it today you would earn a total of 580.00 from holding SBI Cards and or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
SBI Cards and vs. Indian Railway Finance
Performance |
| Timeline |
| SBI Cards |
| Indian Railway Finance |
SBI Cards and Indian Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Cards and Indian Railway
The main advantage of trading using opposite SBI Cards and Indian Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Cards position performs unexpectedly, Indian Railway 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 Indian Railway will offset losses from the drop in Indian Railway's long position.| SBI Cards vs. Advani Hotels Resorts | SBI Cards vs. Reliance Home Finance | SBI Cards vs. Chalet Hotels Limited | SBI Cards vs. EIH Associated Hotels |
| Indian Railway vs. Agro Tech Foods | Indian Railway vs. VIP Clothing Limited | Indian Railway vs. S P Apparels | Indian Railway vs. AAA Technologies 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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