Correlation Between Sonata Software and Akme Fintrade
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By analyzing existing cross correlation between Sonata Software Limited and Akme Fintrade India, you can compare the effects of market volatilities on Sonata Software and Akme Fintrade 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 Sonata Software with a short position of Akme Fintrade. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonata Software and Akme Fintrade.
Diversification Opportunities for Sonata Software and Akme Fintrade
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sonata and Akme is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sonata Software Limited and Akme Fintrade India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akme Fintrade India and Sonata Software 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 Sonata Software Limited are associated (or correlated) with Akme Fintrade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akme Fintrade India has no effect on the direction of Sonata Software i.e., Sonata Software and Akme Fintrade go up and down completely randomly.
Pair Corralation between Sonata Software and Akme Fintrade
Assuming the 90 days trading horizon Sonata Software Limited is expected to generate 0.65 times more return on investment than Akme Fintrade. However, Sonata Software Limited is 1.54 times less risky than Akme Fintrade. It trades about 0.3 of its potential returns per unit of risk. Akme Fintrade India is currently generating about 0.17 per unit of risk. If you would invest 58,500 in Sonata Software Limited on September 13, 2024 and sell it today you would earn a total of 9,815 from holding Sonata Software Limited or generate 16.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Sonata Software Limited vs. Akme Fintrade India
Performance |
| Timeline |
| Sonata Software |
| Akme Fintrade India |
Sonata Software and Akme Fintrade Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonata Software and Akme Fintrade
The main advantage of trading using opposite Sonata Software and Akme Fintrade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonata Software position performs unexpectedly, Akme Fintrade 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 Akme Fintrade will offset losses from the drop in Akme Fintrade's long position.| Sonata Software vs. Vodafone Idea Limited | Sonata Software vs. Yes Bank Limited | Sonata Software vs. Indian Overseas Bank | Sonata Software vs. Indian Oil |
| Akme Fintrade vs. Bajaj Finance Limited | Akme Fintrade vs. Indian Railway Finance | Akme Fintrade vs. Power Finance | Akme Fintrade vs. REC 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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