Correlation Between Tarapur Transformers and One 97

Can any of the company-specific risk be diversified away by investing in both Tarapur Transformers and One 97 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 Tarapur Transformers and One 97 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tarapur Transformers Limited and One 97 Communications, you can compare the effects of market volatilities on Tarapur Transformers and One 97 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 Tarapur Transformers with a short position of One 97. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tarapur Transformers and One 97.

Diversification Opportunities for Tarapur Transformers and One 97

-0.41

Correlation Coefficient

Tarapur Transformers  One 97

Very good diversification

The 3 months correlation between Tarapur and One is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Tarapur Transformers Limited and One 97 Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One 97 Communications and Tarapur Transformers 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 Tarapur Transformers Limited are associated (or correlated) with One 97. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One 97 Communications has no effect on the direction of Tarapur Transformers i.e., Tarapur Transformers and One 97 go up and down completely randomly.

Pair Corralation between Tarapur Transformers and One 97

Assuming the 90 days trading horizon Tarapur Transformers Limited is expected to under-perform the One 97. In addition to that, Tarapur Transformers is 1.18 times more volatile than One 97 Communications. It trades about -0.06 of its total potential returns per unit of risk. One 97 Communications is currently generating about 0.15 per unit of volatility. If you would invest  87,565  in One 97 Communications on April 25, 2025 and sell it today you would earn a total of  19,550  from holding One 97 Communications or generate 22.33% return on investment over 90 days.

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

Tarapur Transformers Limited  vs.  One 97 Communications

Tarapur Transformers

Risk-Adjusted Performance

Very Weak

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

One 97 Communications

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in One 97 Communications are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, One 97 displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tarapur Transformers and One 97

The main advantage of trading using opposite Tarapur Transformers and One 97 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tarapur Transformers position performs unexpectedly, One 97 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 One 97 will offset losses from the drop in One 97's long position.

The idea behind Tarapur Transformers Limited and One 97 Communications 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.