Correlation Between Ceylon Hospitals and VIDULLANKA PLC
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By analyzing existing cross correlation between Ceylon Hospitals PLC and VIDULLANKA PLC, you can compare the effects of market volatilities on Ceylon Hospitals and VIDULLANKA PLC 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 VIDULLANKA PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Hospitals and VIDULLANKA PLC.
Diversification Opportunities for Ceylon Hospitals and VIDULLANKA PLC
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ceylon and VIDULLANKA is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Hospitals PLC and VIDULLANKA PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIDULLANKA 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 VIDULLANKA PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIDULLANKA PLC has no effect on the direction of Ceylon Hospitals i.e., Ceylon Hospitals and VIDULLANKA PLC go up and down completely randomly.
Pair Corralation between Ceylon Hospitals and VIDULLANKA PLC
Assuming the 90 days trading horizon Ceylon Hospitals PLC is expected to under-perform the VIDULLANKA PLC. But the stock apears to be less risky and, when comparing its historical volatility, Ceylon Hospitals PLC is 1.32 times less risky than VIDULLANKA PLC. The stock trades about -0.02 of its potential returns per unit of risk. The VIDULLANKA PLC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 710.00 in VIDULLANKA PLC on August 30, 2024 and sell it today you would earn a total of 200.00 from holding VIDULLANKA PLC or generate 28.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 75.21% |
| Values | Daily Returns |
Ceylon Hospitals PLC vs. VIDULLANKA PLC
Performance |
| Timeline |
| Ceylon Hospitals PLC |
| VIDULLANKA PLC |
Ceylon Hospitals and VIDULLANKA PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceylon Hospitals and VIDULLANKA PLC
The main advantage of trading using opposite Ceylon Hospitals and VIDULLANKA PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Hospitals position performs unexpectedly, VIDULLANKA PLC 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 VIDULLANKA PLC will offset losses from the drop in VIDULLANKA PLC's long position.| Ceylon Hospitals vs. CEYLINCO INSURANCE PLC | Ceylon Hospitals vs. Ceylinco Insurance PLC | Ceylon Hospitals vs. Arpico Insurance | Ceylon Hospitals vs. SEYLAN BANK PLC |
| VIDULLANKA PLC vs. Ceylon Hospitals PLC | VIDULLANKA PLC vs. Lion Brewery Ceylon | VIDULLANKA PLC vs. RENUKA FOODS PLC | VIDULLANKA PLC vs. Ceylon Cold Stores |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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