Correlation Between Ceylon Hospitals and Citrus Leisure
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By analyzing existing cross correlation between Ceylon Hospitals PLC and Citrus Leisure PLC, you can compare the effects of market volatilities on Ceylon Hospitals and Citrus Leisure 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 Citrus Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Hospitals and Citrus Leisure.
Diversification Opportunities for Ceylon Hospitals and Citrus Leisure
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ceylon and Citrus is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Hospitals PLC and Citrus Leisure PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citrus Leisure PLC 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 Citrus Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citrus Leisure PLC has no effect on the direction of Ceylon Hospitals i.e., Ceylon Hospitals and Citrus Leisure go up and down completely randomly.
Pair Corralation between Ceylon Hospitals and Citrus Leisure
Assuming the 90 days trading horizon Ceylon Hospitals PLC is expected to generate 0.64 times more return on investment than Citrus Leisure. However, Ceylon Hospitals PLC is 1.56 times less risky than Citrus Leisure. It trades about -0.01 of its potential returns per unit of risk. Citrus Leisure PLC is currently generating about -0.02 per unit of risk. If you would invest 12,500 in Ceylon Hospitals PLC on September 14, 2024 and sell it today you would lose (675.00) from holding Ceylon Hospitals PLC or give up 5.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 73.05% |
| Values | Daily Returns |
Ceylon Hospitals PLC vs. Citrus Leisure PLC
Performance |
| Timeline |
| Ceylon Hospitals PLC |
| Citrus Leisure PLC |
Ceylon Hospitals and Citrus Leisure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceylon Hospitals and Citrus Leisure
The main advantage of trading using opposite Ceylon Hospitals and Citrus Leisure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Hospitals position performs unexpectedly, Citrus Leisure 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 Citrus Leisure will offset losses from the drop in Citrus Leisure's long position.| Ceylon Hospitals vs. Jat Holdings PLC | Ceylon Hospitals vs. Lanka Credit and | Ceylon Hospitals vs. VIDULLANKA PLC | Ceylon Hospitals vs. Carson Cumberbatch PLC |
| Citrus Leisure vs. Hatton National Bank | Citrus Leisure vs. Lion Brewery Ceylon | Citrus Leisure vs. Merchant Bank of | Citrus Leisure vs. Ceylon Hospitals 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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