Correlation Between SAL Steel and JGCHEMICALS
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By analyzing existing cross correlation between SAL Steel Limited and JGCHEMICALS LIMITED, you can compare the effects of market volatilities on SAL Steel and JGCHEMICALS 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 SAL Steel with a short position of JGCHEMICALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAL Steel and JGCHEMICALS.
Diversification Opportunities for SAL Steel and JGCHEMICALS
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SAL and JGCHEMICALS is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding SAL Steel Limited and JGCHEMICALS LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JGCHEMICALS LIMITED and SAL 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 SAL Steel Limited are associated (or correlated) with JGCHEMICALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JGCHEMICALS LIMITED has no effect on the direction of SAL Steel i.e., SAL Steel and JGCHEMICALS go up and down completely randomly.
Pair Corralation between SAL Steel and JGCHEMICALS
Assuming the 90 days trading horizon SAL Steel is expected to generate 6.24 times less return on investment than JGCHEMICALS. But when comparing it to its historical volatility, SAL Steel Limited is 1.18 times less risky than JGCHEMICALS. It trades about 0.01 of its potential returns per unit of risk. JGCHEMICALS LIMITED is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 29,045 in JGCHEMICALS LIMITED on November 3, 2024 and sell it today you would earn a total of 7,460 from holding JGCHEMICALS LIMITED or generate 25.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SAL Steel Limited vs. JGCHEMICALS LIMITED
Performance |
| Timeline |
| SAL Steel Limited |
| JGCHEMICALS LIMITED |
SAL Steel and JGCHEMICALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAL Steel and JGCHEMICALS
The main advantage of trading using opposite SAL Steel and JGCHEMICALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAL Steel position performs unexpectedly, JGCHEMICALS 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 JGCHEMICALS will offset losses from the drop in JGCHEMICALS's long position.| SAL Steel vs. Sonata Software Limited | SAL Steel vs. Kaynes Technology India | SAL Steel vs. LT Technology Services | SAL Steel vs. Dev Information Technology |
| JGCHEMICALS vs. Lakshmi Finance Industrial | JGCHEMICALS vs. ZF Commercial Vehicle | JGCHEMICALS vs. Praxis Home Retail | JGCHEMICALS vs. Silver Touch Technologies |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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