Correlation Between Page Industries and Som Distilleries

Can any of the company-specific risk be diversified away by investing in both Page Industries and Som Distilleries at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Page Industries and Som Distilleries into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Page Industries Limited and Som Distilleries Breweries, you can compare the effects of market volatilities on Page Industries and Som Distilleries 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 Page Industries with a short position of Som Distilleries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Page Industries and Som Distilleries.

Diversification Opportunities for Page Industries and Som Distilleries

-0.38

Correlation Coefficient

Page Industries  Som Distilleries

Very good diversification

The 3 months correlation between Page and Som is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Page Industries Limited and Som Distilleries Breweries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Som Distilleries Bre and Page Industries 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 Page Industries Limited are associated (or correlated) with Som Distilleries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Som Distilleries Bre has no effect on the direction of Page Industries i.e., Page Industries and Som Distilleries go up and down completely randomly.

Pair Corralation between Page Industries and Som Distilleries

Assuming the 90 days trading horizon Page Industries Limited is expected to generate 0.69 times more return on investment than Som Distilleries. However, Page Industries Limited is 1.44 times less risky than Som Distilleries. It trades about 0.07 of its potential returns per unit of risk. Som Distilleries Breweries is currently generating about -0.05 per unit of risk. If you would invest  4,161,647  in Page Industries Limited on September 2, 2024 and sell it today you would earn a total of  302,843  from holding Page Industries Limited or generate 7.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Page Industries Limited  vs.  Som Distilleries Breweries

Page Industries

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Page Industries Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating forward indicators, Page Industries may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Som Distilleries Bre

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Som Distilleries Breweries has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Page Industries and Som Distilleries

The main advantage of trading using opposite Page Industries and Som Distilleries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Page Industries position performs unexpectedly, Som Distilleries 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 Som Distilleries will offset losses from the drop in Som Distilleries' long position.

The idea behind Page Industries Limited and Som Distilleries Breweries pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.