Correlation Between Silver Touch and AXISILVER

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

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

Diversification Opportunities for Silver Touch and AXISILVER

-0.27

Correlation Coefficient

Silver Touch  AXISILVER

Very good diversification

The 3 months correlation between Silver and AXISILVER is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Silver Touch Technologies and AXISILVER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXISILVER and Silver Touch 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 Silver Touch Technologies are associated (or correlated) with AXISILVER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXISILVER has no effect on the direction of Silver Touch i.e., Silver Touch and AXISILVER go up and down completely randomly.

Pair Corralation between Silver Touch and AXISILVER

Assuming the 90 days trading horizon Silver Touch Technologies is expected to under-perform the AXISILVER. In addition to that, Silver Touch is 1.92 times more volatile than AXISILVER. It trades about -0.01 of its total potential returns per unit of risk. AXISILVER is currently generating about 0.21 per unit of volatility. If you would invest  9,831  in AXISILVER on April 24, 2025 and sell it today you would earn a total of  1,800  from holding AXISILVER or generate 18.31% return on investment over 90 days.

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

Silver Touch Technologies  vs.  AXISILVER

Silver Touch Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Silver Touch Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Silver Touch is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

AXISILVER

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AXISILVER are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, AXISILVER showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Silver Touch and AXISILVER

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

The idea behind Silver Touch Technologies and AXISILVER 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.