Correlation Between RENUKA FOODS and Amana Bank
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By analyzing existing cross correlation between RENUKA FOODS PLC and Amana Bank, you can compare the effects of market volatilities on RENUKA FOODS and Amana Bank 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 RENUKA FOODS with a short position of Amana Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of RENUKA FOODS and Amana Bank.
Diversification Opportunities for RENUKA FOODS and Amana Bank
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between RENUKA and Amana is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding RENUKA FOODS PLC and Amana Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amana Bank and RENUKA FOODS 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 RENUKA FOODS PLC are associated (or correlated) with Amana Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amana Bank has no effect on the direction of RENUKA FOODS i.e., RENUKA FOODS and Amana Bank go up and down completely randomly.
Pair Corralation between RENUKA FOODS and Amana Bank
Assuming the 90 days trading horizon RENUKA FOODS PLC is expected to under-perform the Amana Bank. But the stock apears to be less risky and, when comparing its historical volatility, RENUKA FOODS PLC is 12.82 times less risky than Amana Bank. The stock trades about -0.03 of its potential returns per unit of risk. The Amana Bank is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 300.00 in Amana Bank on September 4, 2024 and sell it today you would earn a total of 2,010 from holding Amana Bank or generate 670.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 74.84% |
| Values | Daily Returns |
RENUKA FOODS PLC vs. Amana Bank
Performance |
| Timeline |
| RENUKA FOODS PLC |
| Amana Bank |
RENUKA FOODS and Amana Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RENUKA FOODS and Amana Bank
The main advantage of trading using opposite RENUKA FOODS and Amana Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RENUKA FOODS position performs unexpectedly, Amana Bank 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 Amana Bank will offset losses from the drop in Amana Bank's long position.| RENUKA FOODS vs. Ceylon Beverage Holdings | RENUKA FOODS vs. Arpico Insurance | RENUKA FOODS vs. Commercial Credit and | RENUKA FOODS vs. Softlogic Life Insurance |
| Amana Bank vs. HATTON NATIONAL BANK | Amana Bank vs. Commercial Credit and | Amana Bank vs. Palm Garden Hotels | Amana Bank vs. Hatton National Bank |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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