Correlation Between Styrenix Performance and Kalyani Steels
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By analyzing existing cross correlation between Styrenix Performance Materials and Kalyani Steels Limited, you can compare the effects of market volatilities on Styrenix Performance and Kalyani Steels 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 Styrenix Performance with a short position of Kalyani Steels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Styrenix Performance and Kalyani Steels.
Diversification Opportunities for Styrenix Performance and Kalyani Steels
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Styrenix and Kalyani is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Styrenix Performance Materials and Kalyani Steels Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kalyani Steels and Styrenix Performance 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 Styrenix Performance Materials are associated (or correlated) with Kalyani Steels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kalyani Steels has no effect on the direction of Styrenix Performance i.e., Styrenix Performance and Kalyani Steels go up and down completely randomly.
Pair Corralation between Styrenix Performance and Kalyani Steels
Assuming the 90 days trading horizon Styrenix Performance Materials is expected to generate 0.75 times more return on investment than Kalyani Steels. However, Styrenix Performance Materials is 1.33 times less risky than Kalyani Steels. It trades about -0.26 of its potential returns per unit of risk. Kalyani Steels Limited is currently generating about -0.39 per unit of risk. If you would invest 294,195 in Styrenix Performance Materials on October 26, 2024 and sell it today you would lose (28,860) from holding Styrenix Performance Materials or give up 9.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Styrenix Performance Materials vs. Kalyani Steels Limited
Performance |
| Timeline |
| Styrenix Performance |
| Kalyani Steels |
Styrenix Performance and Kalyani Steels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Styrenix Performance and Kalyani Steels
The main advantage of trading using opposite Styrenix Performance and Kalyani Steels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Styrenix Performance position performs unexpectedly, Kalyani Steels 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 Kalyani Steels will offset losses from the drop in Kalyani Steels' long position.The idea behind Styrenix Performance Materials and Kalyani Steels Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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