Correlation Between Amreli Steels and JS Global

Can any of the company-specific risk be diversified away by investing in both Amreli Steels and JS Global at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Amreli Steels and JS Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amreli Steels and JS Global Banking, you can compare the effects of market volatilities on Amreli Steels and JS Global 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 Amreli Steels with a short position of JS Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amreli Steels and JS Global.

Diversification Opportunities for Amreli Steels and JS Global

0.46

Correlation Coefficient

Amreli Steels  JS Global

Very weak diversification

The 3 months correlation between Amreli and JSGBETF is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Amreli Steels and JS Global Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JS Global Banking and Amreli Steels 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 Amreli Steels are associated (or correlated) with JS Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JS Global Banking has no effect on the direction of Amreli Steels i.e., Amreli Steels and JS Global go up and down completely randomly.

Pair Corralation between Amreli Steels and JS Global

Assuming the 90 days trading horizon Amreli Steels is expected to under-perform the JS Global. But the stock apears to be less risky and, when comparing its historical volatility, Amreli Steels is 1.22 times less risky than JS Global. The stock trades about -0.09 of its potential returns per unit of risk. The JS Global Banking is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest  2,259  in JS Global Banking on December 5, 2024 and sell it today you would lose (275.00) from holding JS Global Banking or give up 12.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.72%
Values	Daily Returns

Amreli Steels  vs.  JS Global Banking

Amreli Steels

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amreli Steels has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

JS Global Banking

Risk-Adjusted Performance

Very Weak

Over the last 90 days JS Global Banking has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Amreli Steels and JS Global

The main advantage of trading using opposite Amreli Steels and JS Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amreli Steels position performs unexpectedly, JS Global 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 JS Global will offset losses from the drop in JS Global's long position.

The idea behind Amreli Steels and JS Global Banking pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.