Correlation Between MIRC Electronics and Zensar Technologies

Can any of the company-specific risk be diversified away by investing in both MIRC Electronics and Zensar Technologies 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 MIRC Electronics and Zensar Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MIRC Electronics Limited and Zensar Technologies Limited, you can compare the effects of market volatilities on MIRC Electronics and Zensar Technologies 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 MIRC Electronics with a short position of Zensar Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MIRC Electronics and Zensar Technologies.

Diversification Opportunities for MIRC Electronics and Zensar Technologies

0.0

Correlation Coefficient

MIRC Electronics  Zensar Technologies

Pay attention - limited upside

The 3 months correlation between MIRC and Zensar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MIRC Electronics Limited and Zensar Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zensar Technologies and MIRC Electronics 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 MIRC Electronics Limited are associated (or correlated) with Zensar Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zensar Technologies has no effect on the direction of MIRC Electronics i.e., MIRC Electronics and Zensar Technologies go up and down completely randomly.

Pair Corralation between MIRC Electronics and Zensar Technologies

If you would invest  2,415  in MIRC Electronics Limited on October 24, 2024 and sell it today you would lose (83.00) from holding MIRC Electronics Limited or give up 3.44% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

MIRC Electronics Limited  vs.  Zensar Technologies Limited

MIRC Electronics

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MIRC Electronics Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent fundamental indicators, MIRC Electronics exhibited solid returns over the last few months and may actually be approaching a breakup point.

Zensar Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zensar Technologies Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Zensar Technologies is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with MIRC Electronics and Zensar Technologies

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

The idea behind MIRC Electronics Limited and Zensar Technologies Limited 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 Stocks Directory module to find actively traded stocks across global markets.