Correlation Between HNB Finance and Lion Brewery
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By analyzing existing cross correlation between HNB Finance and Lion Brewery Ceylon, you can compare the effects of market volatilities on HNB Finance and Lion Brewery 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 HNB Finance with a short position of Lion Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of HNB Finance and Lion Brewery.
Diversification Opportunities for HNB Finance and Lion Brewery
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between HNB and Lion is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding HNB Finance and Lion Brewery Ceylon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Brewery Ceylon and HNB Finance 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 HNB Finance are associated (or correlated) with Lion Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Brewery Ceylon has no effect on the direction of HNB Finance i.e., HNB Finance and Lion Brewery go up and down completely randomly.
Pair Corralation between HNB Finance and Lion Brewery
Assuming the 90 days trading horizon HNB Finance is expected to generate 1.19 times more return on investment than Lion Brewery. However, HNB Finance is 1.19 times more volatile than Lion Brewery Ceylon. It trades about 0.09 of its potential returns per unit of risk. Lion Brewery Ceylon is currently generating about 0.09 per unit of risk. If you would invest 490.00 in HNB Finance on September 2, 2024 and sell it today you would earn a total of 60.00 from holding HNB Finance or generate 12.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 93.33% |
| Values | Daily Returns |
HNB Finance vs. Lion Brewery Ceylon
Performance |
| Timeline |
| HNB Finance |
| Lion Brewery Ceylon |
HNB Finance and Lion Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HNB Finance and Lion Brewery
The main advantage of trading using opposite HNB Finance and Lion Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HNB Finance position performs unexpectedly, Lion Brewery 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 Lion Brewery will offset losses from the drop in Lion Brewery's long position.| HNB Finance vs. Prime Lands Residencies | HNB Finance vs. VIDULLANKA PLC | HNB Finance vs. EX PACK RUGATED CARTONS |
| Lion Brewery vs. Prime Lands Residencies | Lion Brewery vs. VIDULLANKA PLC | Lion Brewery vs. EX PACK RUGATED CARTONS |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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