Correlation Between Spencers Retail and Garware Hi

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

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

Diversification Opportunities for Spencers Retail and Garware Hi

-0.12

Correlation Coefficient

Spencers Retail  Garware Hi

Good diversification

The 3 months correlation between Spencers and Garware is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Spencers Retail Limited and Garware Hi Tech Films in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garware Hi Tech and Spencers Retail 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 Spencers Retail Limited are associated (or correlated) with Garware Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garware Hi Tech has no effect on the direction of Spencers Retail i.e., Spencers Retail and Garware Hi go up and down completely randomly.

Pair Corralation between Spencers Retail and Garware Hi

Assuming the 90 days trading horizon Spencers Retail Limited is expected to under-perform the Garware Hi. But the stock apears to be less risky and, when comparing its historical volatility, Spencers Retail Limited is 1.31 times less risky than Garware Hi. The stock trades about -0.08 of its potential returns per unit of risk. The Garware Hi Tech Films is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  309,220  in Garware Hi Tech Films on April 20, 2025 and sell it today you would earn a total of  61,470  from holding Garware Hi Tech Films or generate 19.88% return on investment over 90 days.

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

Spencers Retail Limited  vs.  Garware Hi Tech Films

Spencers Retail

Risk-Adjusted Performance

Very Weak

Over the last 90 days Spencers Retail Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unfluctuating performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Garware Hi Tech

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Garware Hi Tech Films are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Garware Hi unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Spencers Retail and Garware Hi

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

The idea behind Spencers Retail Limited and Garware Hi Tech Films 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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.