Correlation Between Ceylon Beverage and Pan Asia
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By analyzing existing cross correlation between Ceylon Beverage Holdings and Pan Asia Banking, you can compare the effects of market volatilities on Ceylon Beverage 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 Ceylon Beverage with a short position of Pan Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Beverage and Pan Asia.
Diversification Opportunities for Ceylon Beverage and Pan Asia
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ceylon and Pan is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Beverage Holdings 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 Ceylon Beverage 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 Ceylon Beverage Holdings 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 Ceylon Beverage i.e., Ceylon Beverage and Pan Asia go up and down completely randomly.
Pair Corralation between Ceylon Beverage and Pan Asia
Assuming the 90 days trading horizon Ceylon Beverage is expected to generate 1.37 times less return on investment than Pan Asia. In addition to that, Ceylon Beverage is 1.0 times more volatile than Pan Asia Banking. It trades about 0.25 of its total potential returns per unit of risk. Pan Asia Banking is currently generating about 0.35 per unit of volatility. If you would invest 1,830 in Pan Asia Banking on September 12, 2024 and sell it today you would earn a total of 930.00 from holding Pan Asia Banking or generate 50.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 49.15% |
| Values | Daily Returns |
Ceylon Beverage Holdings vs. Pan Asia Banking
Performance |
| Timeline |
| Ceylon Beverage Holdings |
| Pan Asia Banking |
Ceylon Beverage and Pan Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceylon Beverage and Pan Asia
The main advantage of trading using opposite Ceylon Beverage and Pan Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Beverage 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.| Ceylon Beverage vs. Aitken Spence Hotel | Ceylon Beverage vs. BROWNS INVESTMENTS PLC | Ceylon Beverage vs. Ceylon Hotels | Ceylon Beverage vs. Sigiriya Village Hotels |
| Pan Asia vs. Lanka Milk Foods | Pan Asia vs. Seylan Bank PLC | Pan Asia vs. Renuka Agri Foods | Pan Asia 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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