Correlation Between Sintex Plastics and Hindustan Foods

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

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

Diversification Opportunities for Sintex Plastics and Hindustan Foods

0.0

Correlation Coefficient

Sintex Plastics  Hindustan Foods

Pay attention - limited upside

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

Pair Corralation between Sintex Plastics and Hindustan Foods

If you would invest  106.00  in Sintex Plastics Technology on October 10, 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

Sintex Plastics Technology  vs.  Hindustan Foods Limited

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 newest stock price uproar, may contribute to short-horizon losses for the private investors.

Hindustan Foods

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hindustan Foods Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental 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.

Pair Trading with Sintex Plastics and Hindustan Foods

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

The idea behind Sintex Plastics Technology and Hindustan Foods 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.