Correlation Between JGCHEMICALS and Himadri Speciality

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

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

Diversification Opportunities for JGCHEMICALS and Himadri Speciality

0.65

Correlation Coefficient

JGCHEMICALS  Himadri Speciality

Poor diversification

The 3 months correlation between JGCHEMICALS and Himadri is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding JGCHEMICALS 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 JGCHEMICALS 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 JGCHEMICALS 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 JGCHEMICALS i.e., JGCHEMICALS and Himadri Speciality go up and down completely randomly.

Pair Corralation between JGCHEMICALS and Himadri Speciality

Assuming the 90 days trading horizon JGCHEMICALS LIMITED is expected to generate 1.09 times more return on investment than Himadri Speciality. However, JGCHEMICALS is 1.09 times more volatile than Himadri Speciality Chemical. It trades about 0.15 of its potential returns per unit of risk. Himadri Speciality Chemical is currently generating about 0.07 per unit of risk. If you would invest  32,385  in JGCHEMICALS LIMITED on April 6, 2025 and sell it today you would earn a total of  13,555  from holding JGCHEMICALS LIMITED or generate 41.86% return on investment over 90 days.

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

JGCHEMICALS LIMITED  vs.  Himadri Speciality Chemical

JGCHEMICALS LIMITED

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in JGCHEMICALS LIMITED are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating technical indicators, JGCHEMICALS sustained solid returns over the last few months and may actually be approaching a breakup point.

Himadri Speciality

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Himadri Speciality Chemical are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Himadri Speciality unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JGCHEMICALS and Himadri Speciality

The main advantage of trading using opposite JGCHEMICALS and Himadri Speciality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JGCHEMICALS 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 JGCHEMICALS 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.

Check out your portfolio center.

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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.