Correlation Between Sonata Software and Elin Electronics
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By analyzing existing cross correlation between Sonata Software Limited and Elin Electronics Limited, you can compare the effects of market volatilities on Sonata Software and Elin Electronics 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 Elin Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonata Software and Elin Electronics.
Diversification Opportunities for Sonata Software and Elin Electronics
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sonata and Elin is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Sonata Software Limited and Elin Electronics Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elin Electronics 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 Elin Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elin Electronics has no effect on the direction of Sonata Software i.e., Sonata Software and Elin Electronics go up and down completely randomly.
Pair Corralation between Sonata Software and Elin Electronics
Assuming the 90 days trading horizon Sonata Software Limited is expected to generate 0.78 times more return on investment than Elin Electronics. However, Sonata Software Limited is 1.28 times less risky than Elin Electronics. It trades about -0.05 of its potential returns per unit of risk. Elin Electronics Limited is currently generating about -0.14 per unit of risk. If you would invest 65,300 in Sonata Software Limited on October 18, 2024 and sell it today you would lose (6,355) from holding Sonata Software Limited or give up 9.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.78% |
| Values | Daily Returns |
Sonata Software Limited vs. Elin Electronics Limited
Performance |
| Timeline |
| Sonata Software |
| Elin Electronics |
Sonata Software and Elin Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonata Software and Elin Electronics
The main advantage of trading using opposite Sonata Software and Elin Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonata Software position performs unexpectedly, Elin Electronics 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 Elin Electronics will offset losses from the drop in Elin Electronics' long position.| Sonata Software vs. Jindal Poly Investment | Sonata Software vs. Ravi Kumar Distilleries | Sonata Software vs. TVS Electronics Limited | Sonata Software vs. Popular Vehicles and |
| Elin Electronics vs. Kalyani Investment | Elin Electronics vs. Syrma SGS Technology | Elin Electronics vs. Sonata Software Limited | Elin Electronics vs. Selan Exploration 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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