Correlation Between Southern Petrochemicals and Oriental Hotels
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By analyzing existing cross correlation between Southern Petrochemicals Industries and Oriental Hotels Limited, you can compare the effects of market volatilities on Southern Petrochemicals and Oriental Hotels 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 Southern Petrochemicals with a short position of Oriental Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Petrochemicals and Oriental Hotels.
Diversification Opportunities for Southern Petrochemicals and Oriental Hotels
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Southern and Oriental is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Southern Petrochemicals Indust and Oriental Hotels Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oriental Hotels and Southern Petrochemicals 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 Southern Petrochemicals Industries are associated (or correlated) with Oriental Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oriental Hotels has no effect on the direction of Southern Petrochemicals i.e., Southern Petrochemicals and Oriental Hotels go up and down completely randomly.
Pair Corralation between Southern Petrochemicals and Oriental Hotels
Assuming the 90 days trading horizon Southern Petrochemicals Industries is expected to under-perform the Oriental Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Southern Petrochemicals Industries is 1.48 times less risky than Oriental Hotels. The stock trades about -0.11 of its potential returns per unit of risk. The Oriental Hotels Limited is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 17,207 in Oriental Hotels Limited on September 25, 2024 and sell it today you would earn a total of 569.00 from holding Oriental Hotels Limited or generate 3.31% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Southern Petrochemicals Indust vs. Oriental Hotels Limited
Performance |
Timeline |
Southern Petrochemicals |
Oriental Hotels |
Southern Petrochemicals and Oriental Hotels Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Southern Petrochemicals and Oriental Hotels
The main advantage of trading using opposite Southern Petrochemicals and Oriental Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Petrochemicals position performs unexpectedly, Oriental Hotels 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 Oriental Hotels will offset losses from the drop in Oriental Hotels' long position.Southern Petrochemicals vs. Bharat Road Network | Southern Petrochemicals vs. Gokul Refoils and | Southern Petrochemicals vs. Ratnamani Metals Tubes | Southern Petrochemicals vs. Bodal Chemicals Limited |
Oriental Hotels vs. Associated Alcohols Breweries | Oriental Hotels vs. MIRC Electronics Limited | Oriental Hotels vs. MIC Electronics Limited | Oriental Hotels vs. Central Bank of |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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