Correlation Between Steelcast and ICICI Bank
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By analyzing existing cross correlation between Steelcast Limited and ICICI Bank Limited, you can compare the effects of market volatilities on Steelcast and ICICI Bank 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 Steelcast with a short position of ICICI Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steelcast and ICICI Bank.
Diversification Opportunities for Steelcast and ICICI Bank
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Steelcast and ICICI is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Steelcast Limited and ICICI Bank Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICICI Bank Limited and Steelcast 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 Steelcast Limited are associated (or correlated) with ICICI Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICICI Bank Limited has no effect on the direction of Steelcast i.e., Steelcast and ICICI Bank go up and down completely randomly.
Pair Corralation between Steelcast and ICICI Bank
Assuming the 90 days trading horizon Steelcast Limited is expected to generate 2.11 times more return on investment than ICICI Bank. However, Steelcast is 2.11 times more volatile than ICICI Bank Limited. It trades about 0.05 of its potential returns per unit of risk. ICICI Bank Limited is currently generating about 0.04 per unit of risk. If you would invest 75,818 in Steelcast Limited on August 29, 2024 and sell it today you would earn a total of 1,627 from holding Steelcast Limited or generate 2.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.24% |
Values | Daily Returns |
Steelcast Limited vs. ICICI Bank Limited
Performance |
Timeline |
Steelcast Limited |
ICICI Bank Limited |
Steelcast and ICICI Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Steelcast and ICICI Bank
The main advantage of trading using opposite Steelcast and ICICI Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steelcast position performs unexpectedly, ICICI Bank 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 ICICI Bank will offset losses from the drop in ICICI Bank's long position.Steelcast vs. Embassy Office Parks | Steelcast vs. Gujarat Narmada Valley | Steelcast vs. Gujarat Alkalies and | Steelcast vs. JTL Industries |
ICICI Bank vs. Hemisphere Properties India | ICICI Bank vs. Juniper Hotels | ICICI Bank vs. Tata Communications Limited | ICICI Bank vs. Royal Orchid Hotels |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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