Correlation Between Ankit Metal and Datamatics Global

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

By analyzing existing cross correlation between Ankit Metal Power and Datamatics Global Services, you can compare the effects of market volatilities on Ankit Metal and Datamatics Global 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 Ankit Metal with a short position of Datamatics Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ankit Metal and Datamatics Global.

Diversification Opportunities for Ankit Metal and Datamatics Global

0.67

Correlation Coefficient

Ankit Metal  Datamatics Global

Poor diversification

The 3 months correlation between Ankit and Datamatics is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Ankit Metal Power and Datamatics Global Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datamatics Global and Ankit Metal 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 Ankit Metal Power are associated (or correlated) with Datamatics Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datamatics Global has no effect on the direction of Ankit Metal i.e., Ankit Metal and Datamatics Global go up and down completely randomly.

Pair Corralation between Ankit Metal and Datamatics Global

Assuming the 90 days trading horizon Ankit Metal Power is expected to generate 0.97 times more return on investment than Datamatics Global. However, Ankit Metal Power is 1.03 times less risky than Datamatics Global. It trades about 0.18 of its potential returns per unit of risk. Datamatics Global Services is currently generating about 0.07 per unit of risk. If you would invest  396.00  in Ankit Metal Power on October 12, 2024 and sell it today you would earn a total of  42.00  from holding Ankit Metal Power or generate 10.61% return on investment over 90 days.

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

Ankit Metal Power  vs.  Datamatics Global Services

Ankit Metal Power

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ankit Metal Power are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Ankit Metal exhibited solid returns over the last few months and may actually be approaching a breakup point.

Datamatics Global

Risk-Adjusted Performance

5 of 100

Modest

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

Pair Trading with Ankit Metal and Datamatics Global

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

The idea behind Ankit Metal Power and Datamatics Global Services 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..