Correlation Between Lanka Realty and Jat Holdings
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By analyzing existing cross correlation between Lanka Realty Investments and Jat Holdings PLC, you can compare the effects of market volatilities on Lanka Realty and Jat Holdings 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 Lanka Realty with a short position of Jat Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lanka Realty and Jat Holdings.
Diversification Opportunities for Lanka Realty and Jat Holdings
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lanka and Jat is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Lanka Realty Investments and Jat Holdings PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jat Holdings PLC and Lanka Realty 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 Lanka Realty Investments are associated (or correlated) with Jat Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jat Holdings PLC has no effect on the direction of Lanka Realty i.e., Lanka Realty and Jat Holdings go up and down completely randomly.
Pair Corralation between Lanka Realty and Jat Holdings
Assuming the 90 days trading horizon Lanka Realty is expected to generate 1.95 times less return on investment than Jat Holdings. In addition to that, Lanka Realty is 1.35 times more volatile than Jat Holdings PLC. It trades about 0.04 of its total potential returns per unit of risk. Jat Holdings PLC is currently generating about 0.1 per unit of volatility. If you would invest 1,490 in Jat Holdings PLC on September 14, 2024 and sell it today you would earn a total of 820.00 from holding Jat Holdings PLC or generate 55.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.29% |
| Values | Daily Returns |
Lanka Realty Investments vs. Jat Holdings PLC
Performance |
| Timeline |
| Lanka Realty Investments |
| Jat Holdings PLC |
Lanka Realty and Jat Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lanka Realty and Jat Holdings
The main advantage of trading using opposite Lanka Realty and Jat Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lanka Realty position performs unexpectedly, Jat Holdings 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 Jat Holdings will offset losses from the drop in Jat Holdings' long position.| Lanka Realty vs. Jat Holdings PLC | Lanka Realty vs. Lanka Credit and | Lanka Realty vs. VIDULLANKA PLC | Lanka Realty vs. Carson Cumberbatch 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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