Correlation Between Amines Plasticizers and Himadri Speciality

Can any of the company-specific risk be diversified away by investing in both Amines Plasticizers and Himadri Speciality 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 Amines Plasticizers and Himadri Speciality into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amines Plasticizers Limited and Himadri Speciality Chemical, you can compare the effects of market volatilities on Amines Plasticizers and Himadri Speciality 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 Amines Plasticizers with a short position of Himadri Speciality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amines Plasticizers and Himadri Speciality.

Diversification Opportunities for Amines Plasticizers and Himadri Speciality

0.72

Correlation Coefficient

Amines Plasticizers  Himadri Speciality

Poor diversification

The 3 months correlation between Amines and Himadri is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Amines Plasticizers Limited and Himadri Speciality Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Himadri Speciality and Amines Plasticizers 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 Amines Plasticizers Limited are associated (or correlated) with Himadri Speciality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Himadri Speciality has no effect on the direction of Amines Plasticizers i.e., Amines Plasticizers and Himadri Speciality go up and down completely randomly.

Pair Corralation between Amines Plasticizers and Himadri Speciality

Assuming the 90 days trading horizon Amines Plasticizers is expected to generate 1.26 times less return on investment than Himadri Speciality. But when comparing it to its historical volatility, Amines Plasticizers Limited is 1.09 times less risky than Himadri Speciality. It trades about 0.05 of its potential returns per unit of risk. Himadri Speciality Chemical is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  47,844  in Himadri Speciality Chemical on April 20, 2025 and sell it today you would earn a total of  3,551  from holding Himadri Speciality Chemical or generate 7.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Amines Plasticizers Limited  vs.  Himadri Speciality Chemical

Amines Plasticizers

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Amines Plasticizers Limited are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting essential indicators, Amines Plasticizers may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Himadri Speciality

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Himadri Speciality Chemical are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Himadri Speciality may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Amines Plasticizers and Himadri Speciality

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

The idea behind Amines Plasticizers Limited and Himadri Speciality Chemical 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.