Correlation Between EX PACK and Mahaweli Reach
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By analyzing existing cross correlation between EX PACK RUGATED CARTONS and Mahaweli Reach Hotel, you can compare the effects of market volatilities on EX PACK and Mahaweli Reach 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 Mahaweli Reach. Check out your portfolio center. Please also check ongoing floating volatility patterns of EX PACK and Mahaweli Reach.
Diversification Opportunities for EX PACK and Mahaweli Reach
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between PACKN0000 and Mahaweli is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding EX PACK RUGATED CARTONS and Mahaweli Reach Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mahaweli Reach Hotel 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 Mahaweli Reach. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mahaweli Reach Hotel has no effect on the direction of EX PACK i.e., EX PACK and Mahaweli Reach go up and down completely randomly.
Pair Corralation between EX PACK and Mahaweli Reach
Assuming the 90 days trading horizon EX PACK is expected to generate 1.08 times less return on investment than Mahaweli Reach. But when comparing it to its historical volatility, EX PACK RUGATED CARTONS is 1.07 times less risky than Mahaweli Reach. It trades about 0.22 of its potential returns per unit of risk. Mahaweli Reach Hotel is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 2,070 in Mahaweli Reach Hotel on October 9, 2024 and sell it today you would earn a total of 210.00 from holding Mahaweli Reach Hotel or generate 10.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
EX PACK RUGATED CARTONS vs. Mahaweli Reach Hotel
Performance |
Timeline |
EX PACK RUGATED |
Mahaweli Reach Hotel |
EX PACK and Mahaweli Reach Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with EX PACK and Mahaweli Reach
The main advantage of trading using opposite EX PACK and Mahaweli Reach positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EX PACK position performs unexpectedly, Mahaweli Reach 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 Mahaweli Reach will offset losses from the drop in Mahaweli Reach's long position.EX PACK vs. E M L | EX PACK vs. Lanka Credit and | EX PACK vs. VIDULLANKA PLC | EX PACK vs. Senkadagala Finance PLC |
Mahaweli Reach vs. HATTON NATIONAL BANK | Mahaweli Reach vs. Sigiriya Village Hotels | Mahaweli Reach vs. Ceylon Hotels | Mahaweli Reach vs. Hatton National Bank |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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