Correlation Between Whirlpool and Golden Tobacco
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By analyzing existing cross correlation between Whirlpool of India and Golden Tobacco Limited, you can compare the effects of market volatilities on Whirlpool and Golden Tobacco 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 Whirlpool with a short position of Golden Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whirlpool and Golden Tobacco.
Diversification Opportunities for Whirlpool and Golden Tobacco
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Whirlpool and Golden is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Whirlpool of India and Golden Tobacco Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Tobacco and Whirlpool 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 Whirlpool of India are associated (or correlated) with Golden Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Tobacco has no effect on the direction of Whirlpool i.e., Whirlpool and Golden Tobacco go up and down completely randomly.
Pair Corralation between Whirlpool and Golden Tobacco
Assuming the 90 days trading horizon Whirlpool is expected to generate 1.46 times less return on investment than Golden Tobacco. But when comparing it to its historical volatility, Whirlpool of India is 1.22 times less risky than Golden Tobacco. It trades about 0.16 of its potential returns per unit of risk. Golden Tobacco Limited is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 3,900 in Golden Tobacco Limited on September 15, 2024 and sell it today you would earn a total of 335.00 from holding Golden Tobacco Limited or generate 8.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Whirlpool of India vs. Golden Tobacco Limited
Performance |
| Timeline |
| Whirlpool of India |
| Golden Tobacco |
Whirlpool and Golden Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whirlpool and Golden Tobacco
The main advantage of trading using opposite Whirlpool and Golden Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whirlpool position performs unexpectedly, Golden Tobacco 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 Golden Tobacco will offset losses from the drop in Golden Tobacco's long position.| Whirlpool vs. Entertainment Network Limited | Whirlpool vs. Shemaroo Entertainment Limited | Whirlpool vs. Infomedia Press Limited | Whirlpool vs. Bharatiya Global Infomedia |
| Golden Tobacco vs. Reliance Industries Limited | Golden Tobacco vs. Oil Natural Gas | Golden Tobacco vs. ICICI Bank Limited | Golden Tobacco vs. Bharti Airtel 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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