Correlation Between ACL Plastics and Pan Asia
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By analyzing existing cross correlation between ACL Plastics PLC and Pan Asia Banking, you can compare the effects of market volatilities on ACL Plastics and Pan Asia 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 ACL Plastics with a short position of Pan Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACL Plastics and Pan Asia.
Diversification Opportunities for ACL Plastics and Pan Asia
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ACL and Pan is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding ACL Plastics PLC and Pan Asia Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan Asia Banking and ACL Plastics 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 ACL Plastics PLC are associated (or correlated) with Pan Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan Asia Banking has no effect on the direction of ACL Plastics i.e., ACL Plastics and Pan Asia go up and down completely randomly.
Pair Corralation between ACL Plastics and Pan Asia
Assuming the 90 days trading horizon ACL Plastics is expected to generate 2.02 times less return on investment than Pan Asia. But when comparing it to its historical volatility, ACL Plastics PLC is 2.49 times less risky than Pan Asia. It trades about 0.42 of its potential returns per unit of risk. Pan Asia Banking is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 2,390 in Pan Asia Banking on August 27, 2024 and sell it today you would earn a total of 260.00 from holding Pan Asia Banking or generate 10.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ACL Plastics PLC vs. Pan Asia Banking
Performance |
| Timeline |
| ACL Plastics PLC |
| Pan Asia Banking |
ACL Plastics and Pan Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACL Plastics and Pan Asia
The main advantage of trading using opposite ACL Plastics and Pan Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACL Plastics position performs unexpectedly, Pan Asia 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 Pan Asia will offset losses from the drop in Pan Asia's long position.| ACL Plastics vs. BROWNS INVESTMENTS PLC | ACL Plastics vs. Convenience Foods PLC | ACL Plastics vs. Keells Food Products | ACL Plastics vs. Lanka Milk Foods |
| Pan Asia vs. Sri Lanka Telecom | Pan Asia vs. ACL Plastics PLC | Pan Asia vs. Merchant Bank of | Pan Asia vs. Mahaweli Reach Hotel |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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