Correlation Between Shivalik Bimetal and Newgen Software

Can any of the company-specific risk be diversified away by investing in both Shivalik Bimetal and Newgen Software 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 Shivalik Bimetal and Newgen Software into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Shivalik Bimetal Controls and Newgen Software Technologies, you can compare the effects of market volatilities on Shivalik Bimetal and Newgen Software 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 Shivalik Bimetal with a short position of Newgen Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shivalik Bimetal and Newgen Software.

Diversification Opportunities for Shivalik Bimetal and Newgen Software

0.8

Correlation Coefficient

Shivalik Bimetal  Newgen Software

Very poor diversification

The 3 months correlation between Shivalik and Newgen is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Shivalik Bimetal Controls and Newgen Software Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newgen Software Tech and Shivalik Bimetal 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 Shivalik Bimetal Controls are associated (or correlated) with Newgen Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newgen Software Tech has no effect on the direction of Shivalik Bimetal i.e., Shivalik Bimetal and Newgen Software go up and down completely randomly.

Pair Corralation between Shivalik Bimetal and Newgen Software

Assuming the 90 days trading horizon Shivalik Bimetal Controls is expected to generate 0.62 times more return on investment than Newgen Software. However, Shivalik Bimetal Controls is 1.6 times less risky than Newgen Software. It trades about 0.06 of its potential returns per unit of risk. Newgen Software Technologies is currently generating about -0.18 per unit of risk. If you would invest  48,905  in Shivalik Bimetal Controls on March 27, 2025 and sell it today you would earn a total of  830.00  from holding Shivalik Bimetal Controls or generate 1.7% return on investment over 90 days.

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

Shivalik Bimetal Controls  vs.  Newgen Software Technologies

Shivalik Bimetal Controls

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Shivalik Bimetal Controls are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Shivalik Bimetal may actually be approaching a critical reversion point that can send shares even higher in July 2025.

Newgen Software Tech

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Newgen Software Technologies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady technical and fundamental indicators, Newgen Software sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Shivalik Bimetal and Newgen Software

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

The idea behind Shivalik Bimetal Controls and Newgen Software Technologies 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.