Correlation Between Akme Fintrade and N B

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

By analyzing existing cross correlation between Akme Fintrade India and N B I, you can compare the effects of market volatilities on Akme Fintrade and N B 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 Akme Fintrade with a short position of N B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akme Fintrade and N B.

Diversification Opportunities for Akme Fintrade and N B

0.16

Correlation Coefficient

Akme Fintrade  N B

Average diversification

The 3 months correlation between Akme and NBIFIN is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Akme Fintrade India and N B I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on N B I and Akme Fintrade 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 Akme Fintrade India are associated (or correlated) with N B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of N B I has no effect on the direction of Akme Fintrade i.e., Akme Fintrade and N B go up and down completely randomly.

Pair Corralation between Akme Fintrade and N B

Assuming the 90 days trading horizon Akme Fintrade India is expected to under-perform the N B. In addition to that, Akme Fintrade is 1.47 times more volatile than N B I. It trades about -0.07 of its total potential returns per unit of risk. N B I is currently generating about 0.07 per unit of volatility. If you would invest  160,803  in N B I on October 9, 2024 and sell it today you would earn a total of  152,052  from holding N B I or generate 94.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	27.04%
Values	Daily Returns

Akme Fintrade India  vs.  N B I

Akme Fintrade India

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Akme Fintrade India has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

N B I

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in N B I are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain technical and fundamental indicators, N B sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Akme Fintrade and N B

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

The idea behind Akme Fintrade India and N B I 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.