Correlation Between Honeywell Automation and Neogen Chemicals
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By analyzing existing cross correlation between Honeywell Automation India and Neogen Chemicals Limited, you can compare the effects of market volatilities on Honeywell Automation and Neogen Chemicals 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 Honeywell Automation with a short position of Neogen Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Honeywell Automation and Neogen Chemicals.
Diversification Opportunities for Honeywell Automation and Neogen Chemicals
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Honeywell and Neogen is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Honeywell Automation India and Neogen Chemicals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neogen Chemicals and Honeywell Automation 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 Honeywell Automation India are associated (or correlated) with Neogen Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neogen Chemicals has no effect on the direction of Honeywell Automation i.e., Honeywell Automation and Neogen Chemicals go up and down completely randomly.
Pair Corralation between Honeywell Automation and Neogen Chemicals
Assuming the 90 days trading horizon Honeywell Automation India is expected to under-perform the Neogen Chemicals. But the stock apears to be less risky and, when comparing its historical volatility, Honeywell Automation India is 2.93 times less risky than Neogen Chemicals. The stock trades about -0.41 of its potential returns per unit of risk. The Neogen Chemicals Limited is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 208,725 in Neogen Chemicals Limited on August 31, 2024 and sell it today you would lose (2,365) from holding Neogen Chemicals Limited or give up 1.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Honeywell Automation India vs. Neogen Chemicals Limited
Performance |
| Timeline |
| Honeywell Automation |
| Neogen Chemicals |
Honeywell Automation and Neogen Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Honeywell Automation and Neogen Chemicals
The main advantage of trading using opposite Honeywell Automation and Neogen Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Honeywell Automation position performs unexpectedly, Neogen Chemicals 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 Neogen Chemicals will offset losses from the drop in Neogen Chemicals' long position.| Honeywell Automation vs. IDBI Bank Limited | Honeywell Automation vs. SIL Investments Limited | Honeywell Automation vs. AUTHUM INVESTMENT INFRASTRUCTU | Honeywell Automation vs. Bajaj Holdings Investment |
| Neogen Chemicals vs. VA Tech Wabag | Neogen Chemicals vs. Data Patterns Limited | Neogen Chemicals vs. PB Fintech Limited | Neogen Chemicals vs. AVALON TECHNOLOGIES LTD |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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