Correlation Between Union Bank and Investment Trust
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By analyzing existing cross correlation between Union Bank of and The Investment Trust, you can compare the effects of market volatilities on Union Bank and Investment Trust 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 Union Bank with a short position of Investment Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Union Bank and Investment Trust.
Diversification Opportunities for Union Bank and Investment Trust
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Union and Investment is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Union Bank of and The Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investment Trust and Union Bank 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 Union Bank of are associated (or correlated) with Investment Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investment Trust has no effect on the direction of Union Bank i.e., Union Bank and Investment Trust go up and down completely randomly.
Pair Corralation between Union Bank and Investment Trust
Assuming the 90 days trading horizon Union Bank is expected to generate 1.73 times less return on investment than Investment Trust. But when comparing it to its historical volatility, Union Bank of is 1.19 times less risky than Investment Trust. It trades about 0.05 of its potential returns per unit of risk. The Investment Trust is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 8,820 in The Investment Trust on September 26, 2024 and sell it today you would earn a total of 11,116 from holding The Investment Trust or generate 126.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 99.8% |
Values | Daily Returns |
Union Bank of vs. The Investment Trust
Performance |
Timeline |
Union Bank |
Investment Trust |
Union Bank and Investment Trust Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Union Bank and Investment Trust
The main advantage of trading using opposite Union Bank and Investment Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Union Bank position performs unexpectedly, Investment Trust 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 Investment Trust will offset losses from the drop in Investment Trust's long position.Union Bank vs. Kingfa Science Technology | Union Bank vs. Rico Auto Industries | Union Bank vs. GACM Technologies Limited | Union Bank vs. COSMO FIRST LIMITED |
Investment Trust vs. Kalyani Investment | Investment Trust vs. SIL Investments Limited | Investment Trust vs. Punjab National Bank | Investment Trust vs. Union Bank of |
Check out your portfolio center.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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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