Correlation Between Speciality Restaurants and IG Petrochemicals
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By analyzing existing cross correlation between Speciality Restaurants Limited and IG Petrochemicals Limited, you can compare the effects of market volatilities on Speciality Restaurants and IG Petrochemicals 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 Speciality Restaurants with a short position of IG Petrochemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Speciality Restaurants and IG Petrochemicals.
Diversification Opportunities for Speciality Restaurants and IG Petrochemicals
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Speciality and IGPL is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Speciality Restaurants Limited and IG Petrochemicals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IG Petrochemicals and Speciality Restaurants 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 Speciality Restaurants Limited are associated (or correlated) with IG Petrochemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IG Petrochemicals has no effect on the direction of Speciality Restaurants i.e., Speciality Restaurants and IG Petrochemicals go up and down completely randomly.
Pair Corralation between Speciality Restaurants and IG Petrochemicals
Assuming the 90 days trading horizon Speciality Restaurants Limited is expected to generate 0.54 times more return on investment than IG Petrochemicals. However, Speciality Restaurants Limited is 1.85 times less risky than IG Petrochemicals. It trades about -0.35 of its potential returns per unit of risk. IG Petrochemicals Limited is currently generating about -0.27 per unit of risk. If you would invest 15,755 in Speciality Restaurants Limited on October 10, 2024 and sell it today you would lose (1,342) from holding Speciality Restaurants Limited or give up 8.52% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Speciality Restaurants Limited vs. IG Petrochemicals Limited
Performance |
Timeline |
Speciality Restaurants |
IG Petrochemicals |
Speciality Restaurants and IG Petrochemicals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Speciality Restaurants and IG Petrochemicals
The main advantage of trading using opposite Speciality Restaurants and IG Petrochemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Speciality Restaurants position performs unexpectedly, IG Petrochemicals 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 IG Petrochemicals will offset losses from the drop in IG Petrochemicals' long position.Speciality Restaurants vs. General Insurance | Speciality Restaurants vs. HDFC Life Insurance | Speciality Restaurants vs. SBI Life Insurance | Speciality Restaurants vs. Newgen Software Technologies |
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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