Correlation Between Ceylon Hospitals and HNB Finance
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By analyzing existing cross correlation between Ceylon Hospitals PLC and HNB Finance, you can compare the effects of market volatilities on Ceylon Hospitals and HNB Finance 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 Hospitals with a short position of HNB Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Hospitals and HNB Finance.
Diversification Opportunities for Ceylon Hospitals and HNB Finance
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ceylon and HNB is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Hospitals PLC and HNB Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HNB Finance and Ceylon Hospitals 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 Hospitals PLC are associated (or correlated) with HNB Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HNB Finance has no effect on the direction of Ceylon Hospitals i.e., Ceylon Hospitals and HNB Finance go up and down completely randomly.
Pair Corralation between Ceylon Hospitals and HNB Finance
Assuming the 90 days trading horizon Ceylon Hospitals PLC is expected to under-perform the HNB Finance. But the stock apears to be less risky and, when comparing its historical volatility, Ceylon Hospitals PLC is 1.51 times less risky than HNB Finance. The stock trades about -0.02 of its potential returns per unit of risk. The HNB Finance is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 540.00 in HNB Finance on August 31, 2024 and sell it today you would earn a total of 20.00 from holding HNB Finance or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.17% |
| Values | Daily Returns |
Ceylon Hospitals PLC vs. HNB Finance
Performance |
| Timeline |
| Ceylon Hospitals PLC |
| HNB Finance |
Ceylon Hospitals and HNB Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceylon Hospitals and HNB Finance
The main advantage of trading using opposite Ceylon Hospitals and HNB Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Hospitals position performs unexpectedly, HNB Finance 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 HNB Finance will offset losses from the drop in HNB Finance's long position.| Ceylon Hospitals vs. HNB Finance | Ceylon Hospitals vs. Prime Lands Residencies | Ceylon Hospitals vs. Jat Holdings PLC | Ceylon Hospitals vs. E M L |
| HNB Finance vs. Palm Garden Hotels | HNB Finance vs. Ceylon Tobacco | HNB Finance vs. Singhe Hospitals | HNB Finance vs. Aitken Spence 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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