Correlation Between V Mart and JM Financial
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By analyzing existing cross correlation between V Mart Retail Limited and JM Financial Limited, you can compare the effects of market volatilities on V Mart and JM Financial 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 V Mart with a short position of JM Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of V Mart and JM Financial.
Diversification Opportunities for V Mart and JM Financial
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VMART and JMFINANCIL is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding V Mart Retail Limited and JM Financial Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JM Financial Limited and V Mart 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 V Mart Retail Limited are associated (or correlated) with JM Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JM Financial Limited has no effect on the direction of V Mart i.e., V Mart and JM Financial go up and down completely randomly.
Pair Corralation between V Mart and JM Financial
Assuming the 90 days trading horizon V Mart Retail Limited is expected to generate 0.77 times more return on investment than JM Financial. However, V Mart Retail Limited is 1.29 times less risky than JM Financial. It trades about 0.12 of its potential returns per unit of risk. JM Financial Limited is currently generating about 0.06 per unit of risk. If you would invest 202,715 in V Mart Retail Limited on September 20, 2024 and sell it today you would earn a total of 176,880 from holding V Mart Retail Limited or generate 87.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
V Mart Retail Limited vs. JM Financial Limited
Performance |
| Timeline |
| V Mart Retail |
| JM Financial Limited |
V Mart and JM Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with V Mart and JM Financial
The main advantage of trading using opposite V Mart and JM Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if V Mart position performs unexpectedly, JM Financial 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 JM Financial will offset losses from the drop in JM Financial's long position.| V Mart vs. Hilton Metal Forging | V Mart vs. Usha Martin Education | V Mart vs. Sintex Plastics Technology | V Mart vs. Cambridge Technology Enterprises |
| JM Financial vs. V Mart Retail Limited | JM Financial vs. Repco Home Finance | JM Financial vs. MSP Steel Power | JM Financial vs. STEEL EXCHANGE INDIA |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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