Correlation Between AnterogenCoLtd and E Mart

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

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

Diversification Opportunities for AnterogenCoLtd and E Mart

0.61

Correlation Coefficient

AnterogenCoLtd  E Mart

Poor diversification

The 3 months correlation between AnterogenCoLtd and 139480 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding AnterogenCoLtd and E Mart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on E Mart and AnterogenCoLtd 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 AnterogenCoLtd are associated (or correlated) with E Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of E Mart has no effect on the direction of AnterogenCoLtd i.e., AnterogenCoLtd and E Mart go up and down completely randomly.

Pair Corralation between AnterogenCoLtd and E Mart

Assuming the 90 days trading horizon AnterogenCoLtd is expected to generate 1.36 times more return on investment than E Mart. However, AnterogenCoLtd is 1.36 times more volatile than E Mart. It trades about 0.07 of its potential returns per unit of risk. E Mart is currently generating about 0.06 per unit of risk. If you would invest  1,439,000  in AnterogenCoLtd on September 27, 2024 and sell it today you would earn a total of  417,000  from holding AnterogenCoLtd or generate 28.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.38%
Values	Daily Returns

AnterogenCoLtd  vs.  E Mart

AnterogenCoLtd

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AnterogenCoLtd are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, AnterogenCoLtd sustained solid returns over the last few months and may actually be approaching a breakup point.

E Mart

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in E Mart are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, E Mart sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AnterogenCoLtd and E Mart

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

The idea behind AnterogenCoLtd and E Mart 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.