Correlation Between Softlogic Life and Dolphin Hotels
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By analyzing existing cross correlation between Softlogic Life Insurance and Dolphin Hotels PLC, you can compare the effects of market volatilities on Softlogic Life and Dolphin Hotels 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 Softlogic Life with a short position of Dolphin Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Softlogic Life and Dolphin Hotels.
Diversification Opportunities for Softlogic Life and Dolphin Hotels
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Softlogic and Dolphin is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Softlogic Life Insurance and Dolphin Hotels PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dolphin Hotels PLC and Softlogic Life 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 Softlogic Life Insurance are associated (or correlated) with Dolphin Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dolphin Hotels PLC has no effect on the direction of Softlogic Life i.e., Softlogic Life and Dolphin Hotels go up and down completely randomly.
Pair Corralation between Softlogic Life and Dolphin Hotels
Assuming the 90 days trading horizon Softlogic Life is expected to generate 5.58 times less return on investment than Dolphin Hotels. But when comparing it to its historical volatility, Softlogic Life Insurance is 1.33 times less risky than Dolphin Hotels. It trades about 0.05 of its potential returns per unit of risk. Dolphin Hotels PLC is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3,110 in Dolphin Hotels PLC on August 30, 2024 and sell it today you would earn a total of 1,100 from holding Dolphin Hotels PLC or generate 35.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Softlogic Life Insurance vs. Dolphin Hotels PLC
Performance |
| Timeline |
| Softlogic Life Insurance |
| Dolphin Hotels PLC |
Softlogic Life and Dolphin Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Softlogic Life and Dolphin Hotels
The main advantage of trading using opposite Softlogic Life and Dolphin Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Softlogic Life position performs unexpectedly, Dolphin Hotels 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 Dolphin Hotels will offset losses from the drop in Dolphin Hotels' long position.| Softlogic Life vs. Renuka Agri Foods | Softlogic Life vs. Ceylon Tobacco | Softlogic Life vs. BROWNS INVESTMENTS PLC | Softlogic Life vs. Lanka Milk Foods |
| Dolphin Hotels vs. Amaya Leisure PLC | Dolphin Hotels vs. Carson Cumberbatch PLC | Dolphin Hotels vs. National Development Bank | Dolphin Hotels vs. RENUKA FOODS 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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