Correlation Between Ceylon Cold and Lanka Realty
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By analyzing existing cross correlation between Ceylon Cold Stores and Lanka Realty Investments, you can compare the effects of market volatilities on Ceylon Cold and Lanka Realty 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 Cold with a short position of Lanka Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Cold and Lanka Realty.
Diversification Opportunities for Ceylon Cold and Lanka Realty
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ceylon and Lanka is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Cold Stores and Lanka Realty Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanka Realty Investments and Ceylon Cold 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 Cold Stores are associated (or correlated) with Lanka Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanka Realty Investments has no effect on the direction of Ceylon Cold i.e., Ceylon Cold and Lanka Realty go up and down completely randomly.
Pair Corralation between Ceylon Cold and Lanka Realty
Assuming the 90 days trading horizon Ceylon Cold Stores is expected to generate 0.72 times more return on investment than Lanka Realty. However, Ceylon Cold Stores is 1.38 times less risky than Lanka Realty. It trades about 0.35 of its potential returns per unit of risk. Lanka Realty Investments is currently generating about 0.06 per unit of risk. If you would invest 8,250 in Ceylon Cold Stores on November 4, 2024 and sell it today you would earn a total of 900.00 from holding Ceylon Cold Stores or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ceylon Cold Stores vs. Lanka Realty Investments
Performance |
| Timeline |
| Ceylon Cold Stores |
| Lanka Realty Investments |
Ceylon Cold and Lanka Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceylon Cold and Lanka Realty
The main advantage of trading using opposite Ceylon Cold and Lanka Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Cold position performs unexpectedly, Lanka Realty 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 Lanka Realty will offset losses from the drop in Lanka Realty's long position.| Ceylon Cold vs. Ceylon Guardian Investment | Ceylon Cold vs. BROWNS INVESTMENTS PLC | Ceylon Cold vs. Distilleries Company of | Ceylon Cold vs. Union Chemicals Lanka |
| Lanka Realty vs. Peoples Insurance PLC | Lanka Realty vs. COMMERCIAL BANK OF | Lanka Realty vs. National Development Bank | Lanka Realty vs. Softlogic Life Insurance |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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