Correlation Between BF Investment and Reliance Home
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By analyzing existing cross correlation between BF Investment Limited and Reliance Home Finance, you can compare the effects of market volatilities on BF Investment and Reliance Home 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 BF Investment with a short position of Reliance Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of BF Investment and Reliance Home.
Diversification Opportunities for BF Investment and Reliance Home
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BFINVEST and Reliance is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding BF Investment Limited and Reliance Home Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reliance Home Finance and BF Investment 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 BF Investment Limited are associated (or correlated) with Reliance Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reliance Home Finance has no effect on the direction of BF Investment i.e., BF Investment and Reliance Home go up and down completely randomly.
Pair Corralation between BF Investment and Reliance Home
Assuming the 90 days trading horizon BF Investment Limited is expected to generate 0.83 times more return on investment than Reliance Home. However, BF Investment Limited is 1.21 times less risky than Reliance Home. It trades about 0.11 of its potential returns per unit of risk. Reliance Home Finance is currently generating about -0.02 per unit of risk. If you would invest 61,085 in BF Investment Limited on September 12, 2024 and sell it today you would earn a total of 12,870 from holding BF Investment Limited or generate 21.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
BF Investment Limited vs. Reliance Home Finance
Performance |
Timeline |
BF Investment Limited |
Reliance Home Finance |
BF Investment and Reliance Home Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BF Investment and Reliance Home
The main advantage of trading using opposite BF Investment and Reliance Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BF Investment position performs unexpectedly, Reliance Home 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 Reliance Home will offset losses from the drop in Reliance Home's long position.BF Investment vs. Yes Bank Limited | BF Investment vs. Indian Oil | BF Investment vs. Indo Borax Chemicals | BF Investment vs. Kingfa Science Technology |
Reliance Home vs. Yes Bank Limited | Reliance Home vs. Indian Oil | Reliance Home vs. Indo Borax Chemicals | Reliance Home vs. Kingfa Science Technology |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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