Correlation Between SBI Cards and Shriram Finance
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By analyzing existing cross correlation between SBI Cards and and Shriram Finance Limited, you can compare the effects of market volatilities on SBI Cards and Shriram Finance 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 Shriram Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Cards and Shriram Finance.
Diversification Opportunities for SBI Cards and Shriram Finance
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SBI and Shriram is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding SBI Cards and and Shriram Finance Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shriram 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 Shriram Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shriram Finance has no effect on the direction of SBI Cards i.e., SBI Cards and Shriram Finance go up and down completely randomly.
Pair Corralation between SBI Cards and Shriram Finance
Assuming the 90 days trading horizon SBI Cards and is expected to generate 0.59 times more return on investment than Shriram Finance. However, SBI Cards and is 1.7 times less risky than Shriram Finance. It trades about 0.04 of its potential returns per unit of risk. Shriram Finance Limited is currently generating about -0.11 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 | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBI Cards and vs. Shriram Finance Limited
Performance |
| Timeline |
| SBI Cards |
| Shriram Finance |
SBI Cards and Shriram Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Cards and Shriram Finance
The main advantage of trading using opposite SBI Cards and Shriram Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Cards position performs unexpectedly, Shriram Finance 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 Shriram Finance will offset losses from the drop in Shriram Finance'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 |
| Shriram Finance vs. Fine Organic Industries | Shriram Finance vs. Sarveshwar Foods Limited | Shriram Finance vs. Foods Inns Limited | Shriram Finance vs. Megastar Foods 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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