Correlation Between Jindal Steel and NIFTY 100
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By analyzing existing cross correlation between Jindal Steel Power and NIFTY 100, you can compare the effects of market volatilities on Jindal Steel and NIFTY 100 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 Jindal Steel with a short position of NIFTY 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jindal Steel and NIFTY 100.
Diversification Opportunities for Jindal Steel and NIFTY 100
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jindal and NIFTY is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Jindal Steel Power and NIFTY 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NIFTY 100 and Jindal Steel 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 Jindal Steel Power are associated (or correlated) with NIFTY 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NIFTY 100 has no effect on the direction of Jindal Steel i.e., Jindal Steel and NIFTY 100 go up and down completely randomly.
Pair Corralation between Jindal Steel and NIFTY 100
Assuming the 90 days trading horizon Jindal Steel Power is expected to under-perform the NIFTY 100. But the stock apears to be less risky and, when comparing its historical volatility, Jindal Steel Power is 7.12 times less risky than NIFTY 100. The stock trades about -0.13 of its potential returns per unit of risk. The NIFTY 100 is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,457,250 in NIFTY 100 on October 25, 2024 and sell it today you would lose (82,585) from holding NIFTY 100 or give up 3.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Jindal Steel Power vs. NIFTY 100
Performance |
| Timeline |
Jindal Steel and NIFTY 100 Volatility Contrast
Predicted Return Density |
| Returns |
Jindal Steel Power
Pair trading matchups for Jindal Steel
NIFTY 100
Pair trading matchups for NIFTY 100
Pair Trading with Jindal Steel and NIFTY 100
The main advantage of trading using opposite Jindal Steel and NIFTY 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jindal Steel position performs unexpectedly, NIFTY 100 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 NIFTY 100 will offset losses from the drop in NIFTY 100's long position.| Jindal Steel vs. NMDC Limited | Jindal Steel vs. Steel Authority of | Jindal Steel vs. Embassy Office Parks | Jindal Steel vs. Jai Balaji Industries |
| NIFTY 100 vs. Dharani SugarsChemicals Limited | NIFTY 100 vs. Sportking India Limited | NIFTY 100 vs. Southern Petrochemicals Industries | NIFTY 100 vs. Omkar Speciality Chemicals |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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