Correlation Between Suzlon Energy and Kotak Mahindra
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By analyzing existing cross correlation between Suzlon Energy Limited and Kotak Mahindra Bank, you can compare the effects of market volatilities on Suzlon Energy and Kotak Mahindra 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 Suzlon Energy with a short position of Kotak Mahindra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzlon Energy and Kotak Mahindra.
Diversification Opportunities for Suzlon Energy and Kotak Mahindra
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Suzlon and Kotak is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Suzlon Energy Limited and Kotak Mahindra Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kotak Mahindra Bank and Suzlon Energy 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 Suzlon Energy Limited are associated (or correlated) with Kotak Mahindra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kotak Mahindra Bank has no effect on the direction of Suzlon Energy i.e., Suzlon Energy and Kotak Mahindra go up and down completely randomly.
Pair Corralation between Suzlon Energy and Kotak Mahindra
Assuming the 90 days trading horizon Suzlon Energy Limited is expected to under-perform the Kotak Mahindra. In addition to that, Suzlon Energy is 4.06 times more volatile than Kotak Mahindra Bank. It trades about -0.06 of its total potential returns per unit of risk. Kotak Mahindra Bank is currently generating about 0.09 per unit of volatility. If you would invest 173,600 in Kotak Mahindra Bank on September 1, 2024 and sell it today you would earn a total of 2,925 from holding Kotak Mahindra Bank or generate 1.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzlon Energy Limited vs. Kotak Mahindra Bank
Performance |
| Timeline |
| Suzlon Energy Limited |
| Kotak Mahindra Bank |
Suzlon Energy and Kotak Mahindra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzlon Energy and Kotak Mahindra
The main advantage of trading using opposite Suzlon Energy and Kotak Mahindra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzlon Energy position performs unexpectedly, Kotak Mahindra 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 Kotak Mahindra will offset losses from the drop in Kotak Mahindra's long position.| Suzlon Energy vs. Thirumalai Chemicals Limited | Suzlon Energy vs. Neogen Chemicals Limited | Suzlon Energy vs. LLOYDS METALS AND | Suzlon Energy vs. Shyam Metalics and |
| Kotak Mahindra vs. Kaynes Technology India | Kotak Mahindra vs. Nucleus Software Exports | Kotak Mahindra vs. FCS Software Solutions | Kotak Mahindra vs. Sarveshwar Foods 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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