Correlation Between VIKRAM SOLAR and Parag Milk

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Can any of the company-specific risk be diversified away by investing in both VIKRAM SOLAR and Parag Milk 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 VIKRAM SOLAR and Parag Milk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VIKRAM SOLAR LIMITED and Parag Milk Foods, you can compare the effects of market volatilities on VIKRAM SOLAR and Parag Milk 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 VIKRAM SOLAR with a short position of Parag Milk. Check out your portfolio center. Please also check ongoing floating volatility patterns of VIKRAM SOLAR and Parag Milk.

Diversification Opportunities for VIKRAM SOLAR and Parag Milk

-0.13
  Correlation Coefficient

Good diversification

The 3 months correlation between VIKRAM and Parag is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding VIKRAM SOLAR LIMITED and Parag Milk Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parag Milk Foods and VIKRAM SOLAR 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 VIKRAM SOLAR LIMITED are associated (or correlated) with Parag Milk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parag Milk Foods has no effect on the direction of VIKRAM SOLAR i.e., VIKRAM SOLAR and Parag Milk go up and down completely randomly.

Pair Corralation between VIKRAM SOLAR and Parag Milk

Assuming the 90 days trading horizon VIKRAM SOLAR LIMITED is expected to under-perform the Parag Milk. But the stock apears to be less risky and, when comparing its historical volatility, VIKRAM SOLAR LIMITED is 1.44 times less risky than Parag Milk. The stock trades about -0.07 of its potential returns per unit of risk. The Parag Milk Foods is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  22,561  in Parag Milk Foods on August 18, 2025 and sell it today you would earn a total of  12,804  from holding Parag Milk Foods or generate 56.75% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy90.77%
ValuesDaily Returns

VIKRAM SOLAR LIMITED  vs.  Parag Milk Foods

 Performance 
       Timeline  
VIKRAM SOLAR LIMITED 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days VIKRAM SOLAR LIMITED has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.
Parag Milk Foods 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Parag Milk Foods are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Parag Milk demonstrated solid returns over the last few months and may actually be approaching a breakup point.

VIKRAM SOLAR and Parag Milk Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with VIKRAM SOLAR and Parag Milk

The main advantage of trading using opposite VIKRAM SOLAR and Parag Milk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VIKRAM SOLAR position performs unexpectedly, Parag Milk 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 Parag Milk will offset losses from the drop in Parag Milk's long position.
The idea behind VIKRAM SOLAR LIMITED and Parag Milk Foods 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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