Correlation Between Credo Brands and Silgo Retail

Can any of the company-specific risk be diversified away by investing in both Credo Brands and Silgo Retail 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 Credo Brands and Silgo Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Credo Brands Marketing and Silgo Retail Limited, you can compare the effects of market volatilities on Credo Brands and Silgo Retail 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 Credo Brands with a short position of Silgo Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credo Brands and Silgo Retail.

Diversification Opportunities for Credo Brands and Silgo Retail

0.79

Correlation Coefficient

Credo Brands  Silgo Retail

Poor diversification

The 3 months correlation between Credo and Silgo is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Credo Brands Marketing and Silgo Retail Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silgo Retail Limited and Credo Brands 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 Credo Brands Marketing are associated (or correlated) with Silgo Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silgo Retail Limited has no effect on the direction of Credo Brands i.e., Credo Brands and Silgo Retail go up and down completely randomly.

Pair Corralation between Credo Brands and Silgo Retail

Assuming the 90 days trading horizon Credo Brands Marketing is expected to generate 1.53 times more return on investment than Silgo Retail. However, Credo Brands is 1.53 times more volatile than Silgo Retail Limited. It trades about 0.12 of its potential returns per unit of risk. Silgo Retail Limited is currently generating about 0.14 per unit of risk. If you would invest  13,559  in Credo Brands Marketing on April 20, 2025 and sell it today you would earn a total of  3,305  from holding Credo Brands Marketing or generate 24.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Credo Brands Marketing  vs.  Silgo Retail Limited

Credo Brands Marketing

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Credo Brands Marketing are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, Credo Brands displayed solid returns over the last few months and may actually be approaching a breakup point.

Silgo Retail Limited

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Silgo Retail Limited are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain essential indicators, Silgo Retail displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Credo Brands and Silgo Retail

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

The idea behind Credo Brands Marketing and Silgo Retail Limited 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.

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 Commodity Directory module to find actively traded commodities issued by global exchanges.