Correlation Between Sonata Software and POWERGRID Infrastructure
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By analyzing existing cross correlation between Sonata Software Limited and POWERGRID Infrastructure Investment, you can compare the effects of market volatilities on Sonata Software and POWERGRID Infrastructure 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 POWERGRID Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonata Software and POWERGRID Infrastructure.
Diversification Opportunities for Sonata Software and POWERGRID Infrastructure
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sonata and POWERGRID is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Sonata Software Limited and POWERGRID Infrastructure Inves in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POWERGRID Infrastructure 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 POWERGRID Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POWERGRID Infrastructure has no effect on the direction of Sonata Software i.e., Sonata Software and POWERGRID Infrastructure go up and down completely randomly.
Pair Corralation between Sonata Software and POWERGRID Infrastructure
Assuming the 90 days trading horizon Sonata Software Limited is expected to under-perform the POWERGRID Infrastructure. In addition to that, Sonata Software is 2.89 times more volatile than POWERGRID Infrastructure Investment. It trades about -0.28 of its total potential returns per unit of risk. POWERGRID Infrastructure Investment is currently generating about -0.32 per unit of volatility. If you would invest 8,720 in POWERGRID Infrastructure Investment on October 11, 2024 and sell it today you would lose (315.00) from holding POWERGRID Infrastructure Investment or give up 3.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sonata Software Limited vs. POWERGRID Infrastructure Inves
Performance |
| Timeline |
| Sonata Software |
| POWERGRID Infrastructure |
Sonata Software and POWERGRID Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonata Software and POWERGRID Infrastructure
The main advantage of trading using opposite Sonata Software and POWERGRID Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonata Software position performs unexpectedly, POWERGRID Infrastructure 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 POWERGRID Infrastructure will offset losses from the drop in POWERGRID Infrastructure's long position.| Sonata Software vs. Manaksia Coated Metals | Sonata Software vs. Transport of | Sonata Software vs. Golden Tobacco Limited | Sonata Software vs. Iris Clothings 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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