Correlation Between Asian Hotels and Seylan Bank
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By analyzing existing cross correlation between Asian Hotels and and Seylan Bank PLC, you can compare the effects of market volatilities on Asian Hotels and Seylan Bank 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 Asian Hotels with a short position of Seylan Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asian Hotels and Seylan Bank.
Diversification Opportunities for Asian Hotels and Seylan Bank
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Asian and Seylan is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Asian Hotels and and Seylan Bank PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seylan Bank PLC and Asian Hotels 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 Asian Hotels and are associated (or correlated) with Seylan Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seylan Bank PLC has no effect on the direction of Asian Hotels i.e., Asian Hotels and Seylan Bank go up and down completely randomly.
Pair Corralation between Asian Hotels and Seylan Bank
Assuming the 90 days trading horizon Asian Hotels is expected to generate 4.27 times less return on investment than Seylan Bank. But when comparing it to its historical volatility, Asian Hotels and is 1.12 times less risky than Seylan Bank. It trades about 0.07 of its potential returns per unit of risk. Seylan Bank PLC is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 4,300 in Seylan Bank PLC on September 2, 2024 and sell it today you would earn a total of 1,800 from holding Seylan Bank PLC or generate 41.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
Asian Hotels and vs. Seylan Bank PLC
Performance |
| Timeline |
| Asian Hotels |
| Seylan Bank PLC |
Asian Hotels and Seylan Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asian Hotels and Seylan Bank
The main advantage of trading using opposite Asian Hotels and Seylan Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asian Hotels position performs unexpectedly, Seylan Bank 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 Seylan Bank will offset losses from the drop in Seylan Bank's long position.| Asian Hotels vs. Peoples Insurance PLC | Asian Hotels vs. Kandy Hotels | Asian Hotels vs. Renuka Agri Foods | Asian Hotels vs. Lanka Milk Foods |
| Seylan Bank vs. Prime Lands Residencies | Seylan Bank vs. VIDULLANKA PLC | Seylan Bank vs. EX PACK RUGATED CARTONS |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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