Correlation Between Galadari Hotels and Sigiriya Village
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By analyzing existing cross correlation between Galadari Hotels Lanka and Sigiriya Village Hotels, you can compare the effects of market volatilities on Galadari Hotels and Sigiriya Village 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 Galadari Hotels with a short position of Sigiriya Village. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galadari Hotels and Sigiriya Village.
Diversification Opportunities for Galadari Hotels and Sigiriya Village
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Galadari and Sigiriya is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Galadari Hotels Lanka and Sigiriya Village Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sigiriya Village Hotels and Galadari Hotels 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 Galadari Hotels Lanka are associated (or correlated) with Sigiriya Village. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sigiriya Village Hotels has no effect on the direction of Galadari Hotels i.e., Galadari Hotels and Sigiriya Village go up and down completely randomly.
Pair Corralation between Galadari Hotels and Sigiriya Village
Assuming the 90 days trading horizon Galadari Hotels is expected to generate 2.81 times less return on investment than Sigiriya Village. But when comparing it to its historical volatility, Galadari Hotels Lanka is 1.47 times less risky than Sigiriya Village. It trades about 0.18 of its potential returns per unit of risk. Sigiriya Village Hotels is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 3,710 in Sigiriya Village Hotels on September 1, 2024 and sell it today you would earn a total of 870.00 from holding Sigiriya Village Hotels or generate 23.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galadari Hotels Lanka vs. Sigiriya Village Hotels
Performance |
| Timeline |
| Galadari Hotels Lanka |
| Sigiriya Village Hotels |
Galadari Hotels and Sigiriya Village Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galadari Hotels and Sigiriya Village
The main advantage of trading using opposite Galadari Hotels and Sigiriya Village positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galadari Hotels position performs unexpectedly, Sigiriya Village 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 Sigiriya Village will offset losses from the drop in Sigiriya Village's long position.| Galadari Hotels vs. HNB Finance | Galadari Hotels vs. Prime Lands Residencies | Galadari Hotels vs. Jat Holdings PLC | Galadari Hotels vs. E M L |
| Sigiriya Village vs. HNB Finance | Sigiriya Village vs. Prime Lands Residencies | Sigiriya Village vs. Jat Holdings PLC | Sigiriya Village vs. E M L |
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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