Correlation Between Sonata Software and Kingfa Science
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By analyzing existing cross correlation between Sonata Software Limited and Kingfa Science Technology, you can compare the effects of market volatilities on Sonata Software and Kingfa Science 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 Kingfa Science. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonata Software and Kingfa Science.
Diversification Opportunities for Sonata Software and Kingfa Science
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sonata and Kingfa is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Sonata Software Limited and Kingfa Science Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingfa Science Technology 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 Kingfa Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingfa Science Technology has no effect on the direction of Sonata Software i.e., Sonata Software and Kingfa Science go up and down completely randomly.
Pair Corralation between Sonata Software and Kingfa Science
Assuming the 90 days trading horizon Sonata Software Limited is expected to under-perform the Kingfa Science. But the stock apears to be less risky and, when comparing its historical volatility, Sonata Software Limited is 1.14 times less risky than Kingfa Science. The stock trades about -0.09 of its potential returns per unit of risk. The Kingfa Science Technology is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 347,990 in Kingfa Science Technology on November 2, 2024 and sell it today you would lose (40,890) from holding Kingfa Science Technology or give up 11.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.04% |
| Values | Daily Returns |
Sonata Software Limited vs. Kingfa Science Technology
Performance |
| Timeline |
| Sonata Software |
| Kingfa Science Technology |
Sonata Software and Kingfa Science Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonata Software and Kingfa Science
The main advantage of trading using opposite Sonata Software and Kingfa Science positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonata Software position performs unexpectedly, Kingfa Science 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 Kingfa Science will offset losses from the drop in Kingfa Science's long position.| Sonata Software vs. Fineotex Chemical Limited | Sonata Software vs. LLOYDS METALS AND | Sonata Software vs. Ankit Metal Power | Sonata Software vs. Sudarshan Chemical Industries |
| Kingfa Science vs. Dodla Dairy Limited | Kingfa Science vs. Foods Inns Limited | Kingfa Science vs. Embassy Office Parks | Kingfa Science vs. Sapphire Foods India |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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