Correlation Between State Trading and Sumitomo Chemical
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By analyzing existing cross correlation between The State Trading and Sumitomo Chemical India, you can compare the effects of market volatilities on State Trading and Sumitomo Chemical 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 State Trading with a short position of Sumitomo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Trading and Sumitomo Chemical.
Diversification Opportunities for State Trading and Sumitomo Chemical
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between State and Sumitomo is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding The State Trading and Sumitomo Chemical India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumitomo Chemical India and State Trading 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 The State Trading are associated (or correlated) with Sumitomo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumitomo Chemical India has no effect on the direction of State Trading i.e., State Trading and Sumitomo Chemical go up and down completely randomly.
Pair Corralation between State Trading and Sumitomo Chemical
Assuming the 90 days trading horizon The State Trading is expected to under-perform the Sumitomo Chemical. In addition to that, State Trading is 1.32 times more volatile than Sumitomo Chemical India. It trades about -0.17 of its total potential returns per unit of risk. Sumitomo Chemical India is currently generating about -0.16 per unit of volatility. If you would invest 53,425 in Sumitomo Chemical India on October 12, 2024 and sell it today you would lose (3,600) from holding Sumitomo Chemical India or give up 6.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The State Trading vs. Sumitomo Chemical India
Performance |
| Timeline |
| State Trading |
| Sumitomo Chemical India |
State Trading and Sumitomo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Trading and Sumitomo Chemical
The main advantage of trading using opposite State Trading and Sumitomo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Trading position performs unexpectedly, Sumitomo Chemical 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 Sumitomo Chemical will offset losses from the drop in Sumitomo Chemical's long position.| State Trading vs. Syrma SGS Technology | State Trading vs. Tera Software Limited | State Trading vs. Shree Pushkar Chemicals | State Trading vs. Dev Information Technology |
| Sumitomo Chemical vs. HDFC Asset Management | Sumitomo Chemical vs. The State Trading | Sumitomo Chemical vs. Industrial Investment Trust | Sumitomo Chemical vs. Reliance Communications 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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