Correlation Between IDFC First and Indian Oil
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By analyzing existing cross correlation between IDFC First Bank and Indian Oil, you can compare the effects of market volatilities on IDFC First and Indian Oil 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 IDFC First with a short position of Indian Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of IDFC First and Indian Oil.
Diversification Opportunities for IDFC First and Indian Oil
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IDFC and Indian is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding IDFC First Bank and Indian Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indian Oil and IDFC First 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 IDFC First Bank are associated (or correlated) with Indian Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indian Oil has no effect on the direction of IDFC First i.e., IDFC First and Indian Oil go up and down completely randomly.
Pair Corralation between IDFC First and Indian Oil
Assuming the 90 days trading horizon IDFC First is expected to generate 1.05 times less return on investment than Indian Oil. In addition to that, IDFC First is 1.16 times more volatile than Indian Oil. It trades about 0.18 of its total potential returns per unit of risk. Indian Oil is currently generating about 0.21 per unit of volatility. If you would invest 13,956 in Indian Oil on August 30, 2025 and sell it today you would earn a total of 2,425 from holding Indian Oil or generate 17.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 96.83% |
| Values | Daily Returns |
IDFC First Bank vs. Indian Oil
Performance |
| Timeline |
| IDFC First Bank |
| Indian Oil |
IDFC First and Indian Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IDFC First and Indian Oil
The main advantage of trading using opposite IDFC First and Indian Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IDFC First position performs unexpectedly, Indian Oil 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 Indian Oil will offset losses from the drop in Indian Oil's long position.| IDFC First vs. Shree Pushkar Chemicals | IDFC First vs. Selan Exploration Technology | IDFC First vs. Krebs Biochemicals and | IDFC First vs. Himadri Speciality Chemical |
| Indian Oil vs. Le Travenues Technology | Indian Oil vs. Network18 Media Investments | Indian Oil vs. Compucom Software Limited | Indian Oil vs. Diligent Media |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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