0 Axis Bank Vs Bank Of Baroda

Over the past one month, a sell-off in the public sector banks has resulted in a breakdown in the co-relation between Axis and BOB, widening the historical price ratio relationship close to Upper Band 2 at 1.59. One year co-relation between Axis and BOB is above 82%, while standard deviation at 0.08.

We believe this widening can continue further to Mean + 3rd deviation and expect axis to perform better than BOB in the near-term before any meaning full reversal. Thereby, we recommend traders to go long on Axis Bank and  short BOB at price ratio of 1.59-1.60 with Stop loss placed at 1.54 for target of 1.67

Long AxisBank (Aug Futs) 1 lot @ cmp 1,047.65
Long AxisBank 66 Shares in cash @ cmp 1041.10
Short Bank of Baroda (Aug Fus) 2 lots @ cmp 655.40

*~Outlflow(`2lac), Time horizon - 15days, Expected return 5-7%


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Thanks for giving your valuable inputs, TRENDGURUS


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