Correlation Between Bodhi Tree and Mangalam Drugs

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Can any of the company-specific risk be diversified away by investing in both Bodhi Tree and Mangalam Drugs 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 Bodhi Tree and Mangalam Drugs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bodhi Tree Multimedia and Mangalam Drugs And, you can compare the effects of market volatilities on Bodhi Tree and Mangalam Drugs 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 Bodhi Tree with a short position of Mangalam Drugs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bodhi Tree and Mangalam Drugs.

Diversification Opportunities for Bodhi Tree and Mangalam Drugs

BodhiMangalamDiversified AwayBodhiMangalamDiversified Away100%
-0.04
  Correlation Coefficient

Good diversification

The 3 months correlation between Bodhi and Mangalam is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Bodhi Tree Multimedia and Mangalam Drugs And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mangalam Drugs And and Bodhi Tree 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 Bodhi Tree Multimedia are associated (or correlated) with Mangalam Drugs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mangalam Drugs And has no effect on the direction of Bodhi Tree i.e., Bodhi Tree and Mangalam Drugs go up and down completely randomly.

Pair Corralation between Bodhi Tree and Mangalam Drugs

Assuming the 90 days trading horizon Bodhi Tree Multimedia is expected to under-perform the Mangalam Drugs. In addition to that, Bodhi Tree is 1.34 times more volatile than Mangalam Drugs And. It trades about -0.08 of its total potential returns per unit of risk. Mangalam Drugs And is currently generating about 0.04 per unit of volatility. If you would invest  10,653  in Mangalam Drugs And on November 18, 2024 and sell it today you would earn a total of  495.00  from holding Mangalam Drugs And or generate 4.65% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Bodhi Tree Multimedia  vs.  Mangalam Drugs And

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -10-5051015
JavaScript chart by amCharts 3.21.15BTML MANGALAM
       Timeline  
Bodhi Tree Multimedia 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Bodhi Tree Multimedia 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 March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb91011121314
Mangalam Drugs And 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Mangalam Drugs And are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain essential indicators, Mangalam Drugs may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb100105110115120125

Bodhi Tree and Mangalam Drugs Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.22-4.66-3.1-1.530.02411.422.874.315.75 0.0250.0300.0350.0400.0450.050
JavaScript chart by amCharts 3.21.15BTML MANGALAM
       Returns  

Pair Trading with Bodhi Tree and Mangalam Drugs

The main advantage of trading using opposite Bodhi Tree and Mangalam Drugs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bodhi Tree position performs unexpectedly, Mangalam Drugs 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 Mangalam Drugs will offset losses from the drop in Mangalam Drugs' long position.
The idea behind Bodhi Tree Multimedia and Mangalam Drugs 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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