Correlation Between Elgi Rubber and NBCC
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By analyzing existing cross correlation between Elgi Rubber and NBCC Limited, you can compare the effects of market volatilities on Elgi Rubber and NBCC 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 Elgi Rubber with a short position of NBCC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elgi Rubber and NBCC.
Diversification Opportunities for Elgi Rubber and NBCC
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Elgi and NBCC is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Elgi Rubber and NBCC Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBCC Limited and Elgi Rubber 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 Elgi Rubber are associated (or correlated) with NBCC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBCC Limited has no effect on the direction of Elgi Rubber i.e., Elgi Rubber and NBCC go up and down completely randomly.
Pair Corralation between Elgi Rubber and NBCC
Assuming the 90 days trading horizon Elgi Rubber is expected to generate 1.26 times more return on investment than NBCC. However, Elgi Rubber is 1.26 times more volatile than NBCC Limited. It trades about 0.12 of its potential returns per unit of risk. NBCC Limited is currently generating about -0.02 per unit of risk. If you would invest 7,395 in Elgi Rubber on September 26, 2024 and sell it today you would earn a total of 4,341 from holding Elgi Rubber or generate 58.7% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Elgi Rubber vs. NBCC Limited
Performance |
Timeline |
Elgi Rubber |
NBCC Limited |
Elgi Rubber and NBCC Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Elgi Rubber and NBCC
The main advantage of trading using opposite Elgi Rubber and NBCC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elgi Rubber position performs unexpectedly, NBCC 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 NBCC will offset losses from the drop in NBCC's long position.Elgi Rubber vs. Reliance Industries Limited | Elgi Rubber vs. Life Insurance | Elgi Rubber vs. Indian Oil | Elgi Rubber vs. Oil Natural Gas |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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