Correlation Between Tangerine Beach and Hatton National
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By analyzing existing cross correlation between Tangerine Beach Hotels and Hatton National Bank, you can compare the effects of market volatilities on Tangerine Beach and Hatton National 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 Tangerine Beach with a short position of Hatton National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tangerine Beach and Hatton National.
Diversification Opportunities for Tangerine Beach and Hatton National
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tangerine and Hatton is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Tangerine Beach Hotels and Hatton National Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hatton National Bank and Tangerine Beach 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 Tangerine Beach Hotels are associated (or correlated) with Hatton National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hatton National Bank has no effect on the direction of Tangerine Beach i.e., Tangerine Beach and Hatton National go up and down completely randomly.
Pair Corralation between Tangerine Beach and Hatton National
Assuming the 90 days trading horizon Tangerine Beach is expected to generate 2.03 times less return on investment than Hatton National. In addition to that, Tangerine Beach is 1.56 times more volatile than Hatton National Bank. It trades about 0.13 of its total potential returns per unit of risk. Hatton National Bank is currently generating about 0.41 per unit of volatility. If you would invest 16,400 in Hatton National Bank on September 15, 2024 and sell it today you would earn a total of 8,500 from holding Hatton National Bank or generate 51.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 96.67% |
Values | Daily Returns |
Tangerine Beach Hotels vs. Hatton National Bank
Performance |
Timeline |
Tangerine Beach Hotels |
Hatton National Bank |
Tangerine Beach and Hatton National Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tangerine Beach and Hatton National
The main advantage of trading using opposite Tangerine Beach and Hatton National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tangerine Beach position performs unexpectedly, Hatton National 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 Hatton National will offset losses from the drop in Hatton National's long position.Tangerine Beach vs. Lanka Credit and | Tangerine Beach vs. VIDULLANKA PLC | Tangerine Beach vs. Carson Cumberbatch PLC | Tangerine Beach vs. Peoples Insurance PLC |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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