Correlation Between Oil Natural and Kewal Kiran

Can any of the company-specific risk be diversified away by investing in both Oil Natural and Kewal Kiran 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 Oil Natural and Kewal Kiran into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Oil Natural Gas and Kewal Kiran Clothing, you can compare the effects of market volatilities on Oil Natural and Kewal Kiran 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 Oil Natural with a short position of Kewal Kiran. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oil Natural and Kewal Kiran.

Diversification Opportunities for Oil Natural and Kewal Kiran

0.39

Correlation Coefficient

Oil Natural  Kewal Kiran

Weak diversification

The 3 months correlation between Oil and Kewal is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Oil Natural Gas and Kewal Kiran Clothing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kewal Kiran Clothing and Oil Natural 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 Oil Natural Gas are associated (or correlated) with Kewal Kiran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kewal Kiran Clothing has no effect on the direction of Oil Natural i.e., Oil Natural and Kewal Kiran go up and down completely randomly.

Pair Corralation between Oil Natural and Kewal Kiran

Assuming the 90 days trading horizon Oil Natural Gas is expected to generate 0.82 times more return on investment than Kewal Kiran. However, Oil Natural Gas is 1.21 times less risky than Kewal Kiran. It trades about 0.03 of its potential returns per unit of risk. Kewal Kiran Clothing is currently generating about -0.13 per unit of risk. If you would invest  23,615  in Oil Natural Gas on December 23, 2024 and sell it today you would earn a total of  627.00  from holding Oil Natural Gas or generate 2.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Oil Natural Gas  vs.  Kewal Kiran Clothing

Oil Natural Gas

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Oil Natural Gas are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Oil Natural is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Kewal Kiran Clothing

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kewal Kiran Clothing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Oil Natural and Kewal Kiran

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

The idea behind Oil Natural Gas and Kewal Kiran Clothing 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.