Correlation Between Ganesh Housing and Sukhjit Starch

Can any of the company-specific risk be diversified away by investing in both Ganesh Housing and Sukhjit Starch 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 Ganesh Housing and Sukhjit Starch into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ganesh Housing and Sukhjit Starch Chemicals, you can compare the effects of market volatilities on Ganesh Housing and Sukhjit Starch 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 Ganesh Housing with a short position of Sukhjit Starch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ganesh Housing and Sukhjit Starch.

Diversification Opportunities for Ganesh Housing and Sukhjit Starch

0.11

Correlation Coefficient

Ganesh Housing  Sukhjit Starch

Average diversification

The 3 months correlation between Ganesh and Sukhjit is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ganesh Housing and Sukhjit Starch Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sukhjit Starch Chemicals and Ganesh Housing 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 Ganesh Housing are associated (or correlated) with Sukhjit Starch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sukhjit Starch Chemicals has no effect on the direction of Ganesh Housing i.e., Ganesh Housing and Sukhjit Starch go up and down completely randomly.

Pair Corralation between Ganesh Housing and Sukhjit Starch

Assuming the 90 days trading horizon Ganesh Housing is expected to generate 1.22 times more return on investment than Sukhjit Starch. However, Ganesh Housing is 1.22 times more volatile than Sukhjit Starch Chemicals. It trades about 0.21 of its potential returns per unit of risk. Sukhjit Starch Chemicals is currently generating about -0.04 per unit of risk. If you would invest  88,250  in Ganesh Housing on October 10, 2024 and sell it today you would earn a total of  40,630  from holding Ganesh Housing or generate 46.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Ganesh Housing  vs.  Sukhjit Starch Chemicals

Ganesh Housing

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ganesh Housing are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting basic indicators, Ganesh Housing demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Sukhjit Starch Chemicals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sukhjit Starch Chemicals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's forward indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Ganesh Housing and Sukhjit Starch

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

The idea behind Ganesh Housing and Sukhjit Starch Chemicals 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.