Correlation Between Syrma SGS and Infosys
Can any of the company-specific risk be diversified away by investing in both Syrma SGS and Infosys at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Syrma SGS and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Syrma SGS Technology and Infosys Limited, you can compare the effects of market volatilities on Syrma SGS and Infosys 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 Syrma SGS with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Syrma SGS and Infosys.
Diversification Opportunities for Syrma SGS and Infosys
Modest diversification
The 3 months correlation between Syrma and Infosys is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Syrma SGS Technology and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited and Syrma SGS 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 Syrma SGS Technology are associated (or correlated) with Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Limited has no effect on the direction of Syrma SGS i.e., Syrma SGS and Infosys go up and down completely randomly.
Pair Corralation between Syrma SGS and Infosys
Assuming the 90 days trading horizon Syrma SGS Technology is expected to generate 1.84 times more return on investment than Infosys. However, Syrma SGS is 1.84 times more volatile than Infosys Limited. It trades about 0.07 of its potential returns per unit of risk. Infosys Limited is currently generating about 0.05 per unit of risk. If you would invest 26,959 in Syrma SGS Technology on October 11, 2024 and sell it today you would earn a total of 34,056 from holding Syrma SGS Technology or generate 126.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Syrma SGS Technology vs. Infosys Limited
Performance |
| Timeline |
| Syrma SGS Technology |
| Infosys Limited |
Syrma SGS and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Syrma SGS and Infosys
The main advantage of trading using opposite Syrma SGS and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Syrma SGS position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| Syrma SGS vs. Automotive Stampings and | Syrma SGS vs. The Orissa Minerals | Syrma SGS vs. Malu Paper Mills | Syrma SGS vs. Kingfa Science Technology |
| Infosys vs. Embassy Office Parks | Infosys vs. Syrma SGS Technology | Infosys vs. Sonata Software Limited | Infosys vs. Cambridge Technology Enterprises |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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