Correlation Between Jindal Poly and Future Retail

Can any of the company-specific risk be diversified away by investing in both Jindal Poly and Future Retail 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 Jindal Poly and Future Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jindal Poly Investment and Future Retail Limited, you can compare the effects of market volatilities on Jindal Poly and Future Retail 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 Poly with a short position of Future Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jindal Poly and Future Retail.

Diversification Opportunities for Jindal Poly and Future Retail

0.0

Correlation Coefficient

Jindal Poly  Future Retail

Pay attention - limited upside

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

Pair Corralation between Jindal Poly and Future Retail

If you would invest  76,155  in Jindal Poly Investment on October 25, 2024 and sell it today you would earn a total of  710.00  from holding Jindal Poly Investment or generate 0.93% return on investment over 90 days.

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

Jindal Poly Investment  vs.  Future Retail Limited

Jindal Poly Investment

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jindal Poly Investment are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Jindal Poly is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Future Retail Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Future Retail Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Future Retail is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Jindal Poly and Future Retail

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

The idea behind Jindal Poly Investment and Future Retail Limited 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.