Correlation Between Sonata Software and Infosys
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By analyzing existing cross correlation between Sonata Software Limited and Infosys Limited, you can compare the effects of market volatilities on Sonata Software and Infosys 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 Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonata Software and Infosys.
Diversification Opportunities for Sonata Software and Infosys
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sonata and Infosys is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Sonata Software Limited and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited 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 Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Limited has no effect on the direction of Sonata Software i.e., Sonata Software and Infosys go up and down completely randomly.
Pair Corralation between Sonata Software and Infosys
Assuming the 90 days trading horizon Sonata Software Limited is expected to under-perform the Infosys. In addition to that, Sonata Software is 1.43 times more volatile than Infosys Limited. It trades about -0.26 of its total potential returns per unit of risk. Infosys Limited is currently generating about -0.03 per unit of volatility. If you would invest 194,710 in Infosys Limited on October 11, 2024 and sell it today you would lose (1,395) from holding Infosys Limited or give up 0.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sonata Software Limited vs. Infosys Limited
Performance |
| Timeline |
| Sonata Software |
| Infosys Limited |
Sonata Software and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonata Software and Infosys
The main advantage of trading using opposite Sonata Software and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonata Software position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| Sonata Software vs. Reliance Industries Limited | Sonata Software vs. HDFC Bank Limited | Sonata Software vs. Tata Consultancy Services | Sonata Software vs. Bharti Airtel Limited |
| Infosys vs. Embassy Office Parks | Infosys vs. Syrma SGS Technology | Infosys vs. Sonata Software Limited | Infosys vs. Cambridge Technology Enterprises |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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