Correlation Between Prime Securities and New Economy
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By analyzing existing cross correlation between Prime Securities Limited and New Economy Fund, you can compare the effects of market volatilities on Prime Securities and New Economy 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 Prime Securities with a short position of New Economy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prime Securities and New Economy.
Diversification Opportunities for Prime Securities and New Economy
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Prime and New is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Prime Securities Limited and New Economy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Economy Fund and Prime Securities 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 Prime Securities Limited are associated (or correlated) with New Economy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Economy Fund has no effect on the direction of Prime Securities i.e., Prime Securities and New Economy go up and down completely randomly.
Pair Corralation between Prime Securities and New Economy
Assuming the 90 days trading horizon Prime Securities Limited is expected to generate 1.67 times more return on investment than New Economy. However, Prime Securities is 1.67 times more volatile than New Economy Fund. It trades about -0.03 of its potential returns per unit of risk. New Economy Fund is currently generating about -0.12 per unit of risk. If you would invest 17,935 in Prime Securities Limited on February 7, 2024 and sell it today you would lose (255.00) from holding Prime Securities Limited or give up 1.42% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 90.48% |
Values | Daily Returns |
Prime Securities Limited vs. New Economy Fund
Performance |
Timeline |
Prime Securities |
New Economy Fund |
Prime Securities and New Economy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Prime Securities and New Economy
The main advantage of trading using opposite Prime Securities and New Economy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prime Securities position performs unexpectedly, New Economy 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 New Economy will offset losses from the drop in New Economy's long position.Prime Securities vs. SIL Investments Limited | Prime Securities vs. Pilani Investment and | Prime Securities vs. Welspun Investments and | Prime Securities vs. RBL Bank Limited |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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