Correlation Between EX PACK and Lanka Milk
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By analyzing existing cross correlation between EX PACK RUGATED CARTONS and Lanka Milk Foods, you can compare the effects of market volatilities on EX PACK and Lanka Milk 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 EX PACK with a short position of Lanka Milk. Check out your portfolio center. Please also check ongoing floating volatility patterns of EX PACK and Lanka Milk.
Diversification Opportunities for EX PACK and Lanka Milk
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PACKN0000 and Lanka is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding EX PACK RUGATED CARTONS and Lanka Milk Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanka Milk Foods and EX PACK 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 EX PACK RUGATED CARTONS are associated (or correlated) with Lanka Milk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanka Milk Foods has no effect on the direction of EX PACK i.e., EX PACK and Lanka Milk go up and down completely randomly.
Pair Corralation between EX PACK and Lanka Milk
Assuming the 90 days trading horizon EX PACK is expected to generate 1.24 times less return on investment than Lanka Milk. But when comparing it to its historical volatility, EX PACK RUGATED CARTONS is 3.15 times less risky than Lanka Milk. It trades about 0.02 of its potential returns per unit of risk. Lanka Milk Foods is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 12,250 in Lanka Milk Foods on September 14, 2024 and sell it today you would lose (8,900) from holding Lanka Milk Foods or give up 72.65% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 98.73% |
Values | Daily Returns |
EX PACK RUGATED CARTONS vs. Lanka Milk Foods
Performance |
Timeline |
EX PACK RUGATED |
Lanka Milk Foods |
EX PACK and Lanka Milk Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with EX PACK and Lanka Milk
The main advantage of trading using opposite EX PACK and Lanka Milk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EX PACK position performs unexpectedly, Lanka Milk 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 Milk will offset losses from the drop in Lanka Milk's long position.EX PACK vs. Jat Holdings PLC | EX PACK vs. Lanka Credit and | EX PACK vs. VIDULLANKA PLC | EX PACK vs. Carson Cumberbatch PLC |
Lanka Milk vs. Jat Holdings PLC | Lanka Milk vs. Lanka Credit and | Lanka Milk vs. VIDULLANKA PLC | Lanka Milk vs. Carson Cumberbatch PLC |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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