Correlation Between FANDIFI TECHNOLOGY and INDIKA ENERGY
Can any of the company-specific risk be diversified away by investing in both FANDIFI TECHNOLOGY and INDIKA ENERGY 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 FANDIFI TECHNOLOGY and INDIKA ENERGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FANDIFI TECHNOLOGY P and INDIKA ENERGY, you can compare the effects of market volatilities on FANDIFI TECHNOLOGY and INDIKA ENERGY 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 FANDIFI TECHNOLOGY with a short position of INDIKA ENERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of FANDIFI TECHNOLOGY and INDIKA ENERGY.
Diversification Opportunities for FANDIFI TECHNOLOGY and INDIKA ENERGY
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FANDIFI and INDIKA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FANDIFI TECHNOLOGY P and INDIKA ENERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INDIKA ENERGY and FANDIFI TECHNOLOGY 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 FANDIFI TECHNOLOGY P are associated (or correlated) with INDIKA ENERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INDIKA ENERGY has no effect on the direction of FANDIFI TECHNOLOGY i.e., FANDIFI TECHNOLOGY and INDIKA ENERGY go up and down completely randomly.
Pair Corralation between FANDIFI TECHNOLOGY and INDIKA ENERGY
Assuming the 90 days horizon FANDIFI TECHNOLOGY P is expected to generate 8.52 times more return on investment than INDIKA ENERGY. However, FANDIFI TECHNOLOGY is 8.52 times more volatile than INDIKA ENERGY. It trades about 0.06 of its potential returns per unit of risk. INDIKA ENERGY is currently generating about 0.0 per unit of risk. If you would invest 1.15 in FANDIFI TECHNOLOGY P on September 2, 2024 and sell it today you would lose (1.10) from holding FANDIFI TECHNOLOGY P or give up 95.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
FANDIFI TECHNOLOGY P vs. INDIKA ENERGY
Performance |
| Timeline |
| FANDIFI TECHNOLOGY |
| INDIKA ENERGY |
FANDIFI TECHNOLOGY and INDIKA ENERGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FANDIFI TECHNOLOGY and INDIKA ENERGY
The main advantage of trading using opposite FANDIFI TECHNOLOGY and INDIKA ENERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FANDIFI TECHNOLOGY position performs unexpectedly, INDIKA ENERGY 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 INDIKA ENERGY will offset losses from the drop in INDIKA ENERGY's long position.| FANDIFI TECHNOLOGY vs. CHINA TONTINE WINES | FANDIFI TECHNOLOGY vs. ITALIAN WINE BRANDS | FANDIFI TECHNOLOGY vs. VIRGIN WINES UK | FANDIFI TECHNOLOGY vs. IMAGIN MEDICAL INC |
| INDIKA ENERGY vs. DiamondRock Hospitality | INDIKA ENERGY vs. TYSON FOODS A | INDIKA ENERGY vs. National Health Investors | INDIKA ENERGY vs. Astral 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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