Correlation Between STEEL EXCHANGE and Megastar Foods
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By analyzing existing cross correlation between STEEL EXCHANGE INDIA and Megastar Foods Limited, you can compare the effects of market volatilities on STEEL EXCHANGE and Megastar Foods 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 STEEL EXCHANGE with a short position of Megastar Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of STEEL EXCHANGE and Megastar Foods.
Diversification Opportunities for STEEL EXCHANGE and Megastar Foods
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between STEEL and Megastar is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding STEEL EXCHANGE INDIA and Megastar Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Megastar Foods and STEEL EXCHANGE 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 STEEL EXCHANGE INDIA are associated (or correlated) with Megastar Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Megastar Foods has no effect on the direction of STEEL EXCHANGE i.e., STEEL EXCHANGE and Megastar Foods go up and down completely randomly.
Pair Corralation between STEEL EXCHANGE and Megastar Foods
Assuming the 90 days trading horizon STEEL EXCHANGE INDIA is expected to generate 0.84 times more return on investment than Megastar Foods. However, STEEL EXCHANGE INDIA is 1.2 times less risky than Megastar Foods. It trades about 0.11 of its potential returns per unit of risk. Megastar Foods Limited is currently generating about -0.12 per unit of risk. If you would invest 1,086 in STEEL EXCHANGE INDIA on September 12, 2024 and sell it today you would earn a total of 34.00 from holding STEEL EXCHANGE INDIA or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
STEEL EXCHANGE INDIA vs. Megastar Foods Limited
Performance |
| Timeline |
| STEEL EXCHANGE INDIA |
| Megastar Foods |
STEEL EXCHANGE and Megastar Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STEEL EXCHANGE and Megastar Foods
The main advantage of trading using opposite STEEL EXCHANGE and Megastar Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STEEL EXCHANGE position performs unexpectedly, Megastar Foods 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 Megastar Foods will offset losses from the drop in Megastar Foods' long position.| STEEL EXCHANGE vs. Steel Authority of | STEEL EXCHANGE vs. Embassy Office Parks | STEEL EXCHANGE vs. Indian Metals Ferro | STEEL EXCHANGE vs. JTL Industries |
| Megastar Foods vs. Indo Borax Chemicals | Megastar Foods vs. Kingfa Science Technology | Megastar Foods vs. Alkali Metals Limited | Megastar Foods vs. Krebs Biochemicals and |
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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