Correlation Between Ankit Metal and State Trading

Can any of the company-specific risk be diversified away by investing in both Ankit Metal and State Trading 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 State Trading 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 The State Trading, you can compare the effects of market volatilities on Ankit Metal and State Trading 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 State Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ankit Metal and State Trading.

Diversification Opportunities for Ankit Metal and State Trading

-0.18

Correlation Coefficient

Ankit Metal  State Trading

Good diversification

The 3 months correlation between Ankit and State is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ankit Metal Power and The State Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Trading 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 State Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Trading has no effect on the direction of Ankit Metal i.e., Ankit Metal and State Trading go up and down completely randomly.

Pair Corralation between Ankit Metal and State Trading

Assuming the 90 days trading horizon Ankit Metal Power is expected to generate 1.27 times more return on investment than State Trading. However, Ankit Metal is 1.27 times more volatile than The State Trading. It trades about 0.44 of its potential returns per unit of risk. The State Trading is currently generating about -0.09 per unit of risk. If you would invest  370.00  in Ankit Metal Power on October 8, 2024 and sell it today you would earn a total of  92.00  from holding Ankit Metal Power or generate 24.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	94.74%
Values	Daily Returns

Ankit Metal Power  vs.  The State Trading

Ankit Metal Power

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ankit Metal Power are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Ankit Metal exhibited solid returns over the last few months and may actually be approaching a breakup point.

State Trading

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in The State Trading are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, State Trading is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Ankit Metal and State Trading

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

The idea behind Ankit Metal Power and The State Trading 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.