Correlation Between CK Power and Bhiraj Office

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

By analyzing existing cross correlation between CK Power Public and Bhiraj Office Leasehold, you can compare the effects of market volatilities on CK Power and Bhiraj Office 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 CK Power with a short position of Bhiraj Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of CK Power and Bhiraj Office.

Diversification Opportunities for CK Power and Bhiraj Office

-0.62

Correlation Coefficient

CK Power  Bhiraj Office

Excellent diversification

The 3 months correlation between CKP-R and Bhiraj is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding CK Power Public and Bhiraj Office Leasehold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bhiraj Office Leasehold and CK Power 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 CK Power Public are associated (or correlated) with Bhiraj Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bhiraj Office Leasehold has no effect on the direction of CK Power i.e., CK Power and Bhiraj Office go up and down completely randomly.

Pair Corralation between CK Power and Bhiraj Office

Assuming the 90 days trading horizon CK Power Public is expected to under-perform the Bhiraj Office. In addition to that, CK Power is 1.83 times more volatile than Bhiraj Office Leasehold. It trades about -0.03 of its total potential returns per unit of risk. Bhiraj Office Leasehold is currently generating about -0.04 per unit of volatility. If you would invest  646.00  in Bhiraj Office Leasehold on October 10, 2024 and sell it today you would lose (141.00) from holding Bhiraj Office Leasehold or give up 21.83% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.79%
Values	Daily Returns

CK Power Public  vs.  Bhiraj Office Leasehold

CK Power Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CK Power Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Bhiraj Office Leasehold

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bhiraj Office Leasehold are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Bhiraj Office is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with CK Power and Bhiraj Office

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

The idea behind CK Power Public and Bhiraj Office Leasehold 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.