Correlation Between WESTLIFE FOODWORLD and Capacite Infraprojects
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By analyzing existing cross correlation between WESTLIFE FOODWORLD LIMITED and Capacite Infraprojects Limited, you can compare the effects of market volatilities on WESTLIFE FOODWORLD and Capacite Infraprojects 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 WESTLIFE FOODWORLD with a short position of Capacite Infraprojects. Check out your portfolio center. Please also check ongoing floating volatility patterns of WESTLIFE FOODWORLD and Capacite Infraprojects.
Diversification Opportunities for WESTLIFE FOODWORLD and Capacite Infraprojects
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between WESTLIFE and Capacite is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding WESTLIFE FOODWORLD LIMITED and Capacite Infraprojects Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capacite Infraprojects and WESTLIFE FOODWORLD 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 WESTLIFE FOODWORLD LIMITED are associated (or correlated) with Capacite Infraprojects. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capacite Infraprojects has no effect on the direction of WESTLIFE FOODWORLD i.e., WESTLIFE FOODWORLD and Capacite Infraprojects go up and down completely randomly.
Pair Corralation between WESTLIFE FOODWORLD and Capacite Infraprojects
Assuming the 90 days trading horizon WESTLIFE FOODWORLD LIMITED is expected to generate 0.73 times more return on investment than Capacite Infraprojects. However, WESTLIFE FOODWORLD LIMITED is 1.36 times less risky than Capacite Infraprojects. It trades about -0.23 of its potential returns per unit of risk. Capacite Infraprojects Limited is currently generating about -0.2 per unit of risk. If you would invest 80,380 in WESTLIFE FOODWORLD LIMITED on November 5, 2024 and sell it today you would lose (7,795) from holding WESTLIFE FOODWORLD LIMITED or give up 9.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WESTLIFE FOODWORLD LIMITED vs. Capacite Infraprojects Limited
Performance |
| Timeline |
| WESTLIFE FOODWORLD |
| Capacite Infraprojects |
WESTLIFE FOODWORLD and Capacite Infraprojects Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WESTLIFE FOODWORLD and Capacite Infraprojects
The main advantage of trading using opposite WESTLIFE FOODWORLD and Capacite Infraprojects positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WESTLIFE FOODWORLD position performs unexpectedly, Capacite Infraprojects 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 Capacite Infraprojects will offset losses from the drop in Capacite Infraprojects' long position.| WESTLIFE FOODWORLD vs. Network18 Media Investments | WESTLIFE FOODWORLD vs. Jindal Poly Investment | WESTLIFE FOODWORLD vs. Sintex Plastics Technology | WESTLIFE FOODWORLD vs. Newgen Software Technologies |
| Capacite Infraprojects vs. Visa Steel Limited | Capacite Infraprojects vs. Rama Steel Tubes | Capacite Infraprojects vs. Zydus Wellness Limited | Capacite Infraprojects vs. Blue Jet Healthcare |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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