Correlation Between Amana Bank and Eden Hotel
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By analyzing existing cross correlation between Amana Bank and Eden Hotel Lanka, you can compare the effects of market volatilities on Amana Bank and Eden Hotel 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 Amana Bank with a short position of Eden Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amana Bank and Eden Hotel.
Diversification Opportunities for Amana Bank and Eden Hotel
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amana and Eden is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Amana Bank and Eden Hotel Lanka in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eden Hotel Lanka and Amana Bank 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 Amana Bank are associated (or correlated) with Eden Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eden Hotel Lanka has no effect on the direction of Amana Bank i.e., Amana Bank and Eden Hotel go up and down completely randomly.
Pair Corralation between Amana Bank and Eden Hotel
Assuming the 90 days trading horizon Amana Bank is expected to generate 13.65 times more return on investment than Eden Hotel. However, Amana Bank is 13.65 times more volatile than Eden Hotel Lanka. It trades about 0.05 of its potential returns per unit of risk. Eden Hotel Lanka is currently generating about 0.0 per unit of risk. If you would invest 290.00 in Amana Bank on September 3, 2024 and sell it today you would earn a total of 2,030 from holding Amana Bank or generate 700.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.95% |
| Values | Daily Returns |
Amana Bank vs. Eden Hotel Lanka
Performance |
| Timeline |
| Amana Bank |
| Eden Hotel Lanka |
Amana Bank and Eden Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amana Bank and Eden Hotel
The main advantage of trading using opposite Amana Bank and Eden Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amana Bank position performs unexpectedly, Eden Hotel 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 Eden Hotel will offset losses from the drop in Eden Hotel's long position.| Amana Bank vs. Renuka Agri Foods | Amana Bank vs. HDFC Bank of | Amana Bank vs. RENUKA FOODS PLC | Amana Bank vs. Commercial Credit and |
| Eden Hotel vs. Lanka Credit and | Eden Hotel vs. VIDULLANKA PLC | Eden Hotel vs. Carson Cumberbatch PLC | Eden Hotel vs. Peoples Insurance 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 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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