Correlation Between State Bank and Kewal Kiran
Can any of the company-specific risk be diversified away by investing in both State Bank and Kewal Kiran at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining State Bank and Kewal Kiran into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Bank of and Kewal Kiran Clothing, you can compare the effects of market volatilities on State Bank and Kewal Kiran 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 State Bank with a short position of Kewal Kiran. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Bank and Kewal Kiran.
Diversification Opportunities for State Bank and Kewal Kiran
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between State and Kewal is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding State Bank of and Kewal Kiran Clothing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kewal Kiran Clothing and State Bank 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 State Bank of are associated (or correlated) with Kewal Kiran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kewal Kiran Clothing has no effect on the direction of State Bank i.e., State Bank and Kewal Kiran go up and down completely randomly.
Pair Corralation between State Bank and Kewal Kiran
Assuming the 90 days trading horizon State Bank of is expected to generate 0.57 times more return on investment than Kewal Kiran. However, State Bank of is 1.77 times less risky than Kewal Kiran. It trades about -0.08 of its potential returns per unit of risk. Kewal Kiran Clothing is currently generating about -0.12 per unit of risk. If you would invest 79,340 in State Bank of on November 4, 2024 and sell it today you would lose (2,050) from holding State Bank of or give up 2.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Bank of vs. Kewal Kiran Clothing
Performance |
| Timeline |
| State Bank |
| Kewal Kiran Clothing |
State Bank and Kewal Kiran Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Bank and Kewal Kiran
The main advantage of trading using opposite State Bank and Kewal Kiran positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Bank position performs unexpectedly, Kewal Kiran 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 Kewal Kiran will offset losses from the drop in Kewal Kiran's long position.| State Bank vs. Aarti Drugs Limited | State Bank vs. SANOFI S HEALTHC | State Bank vs. Apollo Hospitals Enterprise | State Bank vs. Zota Health Care |
| Kewal Kiran vs. Rajnandini Metal Limited | Kewal Kiran vs. Pilani Investment and | Kewal Kiran vs. POWERGRID Infrastructure Investment | Kewal Kiran vs. BF Utilities 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |