Opposite Correlation Between Stocks and Market


Hey Mates,

Why some stocks have no or opposite correlation with their respective index? I am taking about stocks which sometimes do correlate but sometimes don’t.

Today eg. SBIN and Bank Nifty.
Am I missing something?


You want every thing to move in one direction?

You want everything to be obvious and easy?

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Hehe, I don’t expect that.
I am just asking why this happens.


@Dovah You cannot say it is “some stocks have no or opposite correlation with their respective index” As Index value derive from Stock if SBIN move opposite of INDEX than there is something wrong (assuming SBIN fall)with SBIN and again it’s all INVESTOR and TRADER views/feeling.
As far as INDEX is concern you can search how index value is calculated.


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Ohh… I thought the other way around.
Then why people say to look at the respective index before trading in a corresponding stock? Just to get an idea where most of the shares are the heading?


It’s just SECTORIAL view/momentum as in this case is BANK NIFTY. :slight_smile:

As we FIRSTLY see the potential sector and then select right stock of that sector.

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Got it. Thanks so much :slight_smile:


happens when stocks with more weightage are pulling index.

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