Correlation Between Shipping and Federal Bank
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By analyzing existing cross correlation between Shipping and The Federal Bank, you can compare the effects of market volatilities on Shipping and Federal 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 Shipping with a short position of Federal Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shipping and Federal Bank.
Diversification Opportunities for Shipping and Federal Bank
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shipping and Federal is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Shipping and The Federal Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Bank and Shipping 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 Shipping are associated (or correlated) with Federal Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Bank has no effect on the direction of Shipping i.e., Shipping and Federal Bank go up and down completely randomly.
Pair Corralation between Shipping and Federal Bank
Assuming the 90 days trading horizon Shipping is expected to generate 2.14 times more return on investment than Federal Bank. However, Shipping is 2.14 times more volatile than The Federal Bank. It trades about 0.17 of its potential returns per unit of risk. The Federal Bank is currently generating about 0.12 per unit of risk. If you would invest 21,328 in Shipping on September 3, 2024 and sell it today you would earn a total of 2,159 from holding Shipping or generate 10.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shipping vs. The Federal Bank
Performance |
| Timeline |
| Shipping |
| Federal Bank |
Shipping and Federal Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shipping and Federal Bank
The main advantage of trading using opposite Shipping and Federal Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shipping position performs unexpectedly, Federal 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 Federal Bank will offset losses from the drop in Federal Bank's long position.| Shipping vs. Sintex Plastics Technology | Shipping vs. Shyam Metalics and | Shipping vs. Hilton Metal Forging | Shipping vs. Sonata Software Limited |
| Federal Bank vs. Reliance Industries Limited | Federal Bank vs. Shipping | Federal Bank vs. Indo Borax Chemicals | Federal Bank vs. Kingfa Science Technology |
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.
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