Correlation Between Baazar Style and Gokul Refoils

Can any of the company-specific risk be diversified away by investing in both Baazar Style and Gokul Refoils 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 Baazar Style and Gokul Refoils into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Baazar Style Retail and Gokul Refoils and, you can compare the effects of market volatilities on Baazar Style and Gokul Refoils 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 Baazar Style with a short position of Gokul Refoils. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baazar Style and Gokul Refoils.

Diversification Opportunities for Baazar Style and Gokul Refoils

-0.27

Correlation Coefficient

Baazar Style  Gokul Refoils

Very good diversification

The 3 months correlation between Baazar and Gokul is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Baazar Style Retail and Gokul Refoils and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gokul Refoils and Baazar Style 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 Baazar Style Retail are associated (or correlated) with Gokul Refoils. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gokul Refoils has no effect on the direction of Baazar Style i.e., Baazar Style and Gokul Refoils go up and down completely randomly.

Pair Corralation between Baazar Style and Gokul Refoils

Assuming the 90 days trading horizon Baazar Style Retail is expected to under-perform the Gokul Refoils. But the stock apears to be less risky and, when comparing its historical volatility, Baazar Style Retail is 1.03 times less risky than Gokul Refoils. The stock trades about -0.05 of its potential returns per unit of risk. The Gokul Refoils and is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  5,008  in Gokul Refoils and on September 4, 2024 and sell it today you would earn a total of  761.00  from holding Gokul Refoils and or generate 15.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Baazar Style Retail  vs.  Gokul Refoils and

Baazar Style Retail

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Baazar Style Retail has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Gokul Refoils

Risk-Adjusted Performance

6 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gokul Refoils and are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward-looking signals, Gokul Refoils displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Baazar Style and Gokul Refoils

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

The idea behind Baazar Style Retail and Gokul Refoils and 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.