Correlation Between Jat Holdings and Lanka Realty
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By analyzing existing cross correlation between Jat Holdings PLC and Lanka Realty Investments, you can compare the effects of market volatilities on Jat Holdings and Lanka Realty 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 Jat Holdings with a short position of Lanka Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jat Holdings and Lanka Realty.
Diversification Opportunities for Jat Holdings and Lanka Realty
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Jat and Lanka is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Jat Holdings PLC and Lanka Realty Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanka Realty Investments and Jat Holdings 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 Jat Holdings PLC are associated (or correlated) with Lanka Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanka Realty Investments has no effect on the direction of Jat Holdings i.e., Jat Holdings and Lanka Realty go up and down completely randomly.
Pair Corralation between Jat Holdings and Lanka Realty
Assuming the 90 days trading horizon Jat Holdings PLC is expected to generate 0.72 times more return on investment than Lanka Realty. However, Jat Holdings PLC is 1.39 times less risky than Lanka Realty. It trades about 0.27 of its potential returns per unit of risk. Lanka Realty Investments is currently generating about 0.08 per unit of risk. If you would invest 1,640 in Jat Holdings PLC on September 14, 2024 and sell it today you would earn a total of 670.00 from holding Jat Holdings PLC or generate 40.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Jat Holdings PLC vs. Lanka Realty Investments
Performance |
Timeline |
Jat Holdings PLC |
Lanka Realty Investments |
Jat Holdings and Lanka Realty Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jat Holdings and Lanka Realty
The main advantage of trading using opposite Jat Holdings and Lanka Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jat Holdings position performs unexpectedly, Lanka Realty 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 Lanka Realty will offset losses from the drop in Lanka Realty's long position.Jat Holdings vs. Peoples Insurance PLC | Jat Holdings vs. HVA Foods PLC | Jat Holdings vs. Ceylon Beverage Holdings | Jat Holdings vs. PEOPLES LEASING FINANCE |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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