Correlation Between JGCHEMICALS and Steel Authority
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By analyzing existing cross correlation between JGCHEMICALS LIMITED and Steel Authority of, you can compare the effects of market volatilities on JGCHEMICALS and Steel Authority 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 JGCHEMICALS with a short position of Steel Authority. Check out your portfolio center. Please also check ongoing floating volatility patterns of JGCHEMICALS and Steel Authority.
Diversification Opportunities for JGCHEMICALS and Steel Authority
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between JGCHEMICALS and Steel is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding JGCHEMICALS LIMITED and Steel Authority of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steel Authority and JGCHEMICALS 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 JGCHEMICALS LIMITED are associated (or correlated) with Steel Authority. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steel Authority has no effect on the direction of JGCHEMICALS i.e., JGCHEMICALS and Steel Authority go up and down completely randomly.
Pair Corralation between JGCHEMICALS and Steel Authority
Assuming the 90 days trading horizon JGCHEMICALS LIMITED is expected to generate 1.65 times more return on investment than Steel Authority. However, JGCHEMICALS is 1.65 times more volatile than Steel Authority of. It trades about 0.13 of its potential returns per unit of risk. Steel Authority of is currently generating about 0.04 per unit of risk. If you would invest 18,480 in JGCHEMICALS LIMITED on September 3, 2024 and sell it today you would earn a total of 25,025 from holding JGCHEMICALS LIMITED or generate 135.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 36.48% |
| Values | Daily Returns |
JGCHEMICALS LIMITED vs. Steel Authority of
Performance |
| Timeline |
| JGCHEMICALS LIMITED |
| Steel Authority |
JGCHEMICALS and Steel Authority Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JGCHEMICALS and Steel Authority
The main advantage of trading using opposite JGCHEMICALS and Steel Authority positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JGCHEMICALS position performs unexpectedly, Steel Authority 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 Steel Authority will offset losses from the drop in Steel Authority's long position.| JGCHEMICALS vs. Rajnandini Metal Limited | JGCHEMICALS vs. Indo Borax Chemicals | JGCHEMICALS vs. Kingfa Science Technology | JGCHEMICALS vs. Alkali Metals Limited |
| Steel Authority vs. Tamilnadu Telecommunication Limited | Steel Authority vs. JGCHEMICALS LIMITED | Steel Authority vs. Global Education Limited | Steel Authority vs. Paramount Communications Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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