Correlation Between Jai Balaji and Sintex Plastics

Can any of the company-specific risk be diversified away by investing in both Jai Balaji and Sintex Plastics 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 Jai Balaji and Sintex Plastics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jai Balaji Industries and Sintex Plastics Technology, you can compare the effects of market volatilities on Jai Balaji and Sintex Plastics 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 Jai Balaji with a short position of Sintex Plastics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jai Balaji and Sintex Plastics.

Diversification Opportunities for Jai Balaji and Sintex Plastics

0.0

Correlation Coefficient

Jai Balaji  Sintex Plastics

Pay attention - limited upside

The 3 months correlation between Jai and Sintex is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Jai Balaji Industries and Sintex Plastics Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sintex Plastics Tech and Jai Balaji 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 Jai Balaji Industries are associated (or correlated) with Sintex Plastics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sintex Plastics Tech has no effect on the direction of Jai Balaji i.e., Jai Balaji and Sintex Plastics go up and down completely randomly.

Pair Corralation between Jai Balaji and Sintex Plastics

If you would invest  106.00  in Sintex Plastics Technology on October 4, 2024 and sell it today you would earn a total of  0.00  from holding Sintex Plastics Technology or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Jai Balaji Industries  vs.  Sintex Plastics Technology

Jai Balaji Industries

Risk-Adjusted Performance

0 of 100

Very Weak

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

Sintex Plastics Tech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sintex Plastics Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Sintex Plastics is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Jai Balaji and Sintex Plastics

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

The idea behind Jai Balaji Industries and Sintex Plastics Technology 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.