Correlation Between Hatton National and Amana Bank
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By analyzing existing cross correlation between Hatton National Bank and Amana Bank, you can compare the effects of market volatilities on Hatton National 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 Hatton National with a short position of Amana Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hatton National and Amana Bank.
Diversification Opportunities for Hatton National and Amana Bank
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hatton and Amana is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Hatton National Bank and Amana Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amana Bank and Hatton National 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 Hatton National Bank 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 Hatton National i.e., Hatton National and Amana Bank go up and down completely randomly.
Pair Corralation between Hatton National and Amana Bank
Assuming the 90 days trading horizon Hatton National is expected to generate 8.7 times less return on investment than Amana Bank. But when comparing it to its historical volatility, Hatton National Bank is 20.49 times less risky than Amana Bank. It trades about 0.11 of its potential returns per unit of risk. 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 August 27, 2024 and sell it today you would earn a total of 2,000 from holding Amana Bank or generate 666.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.85% |
| Values | Daily Returns |
Hatton National Bank vs. Amana Bank
Performance |
| Timeline |
| Hatton National Bank |
| Amana Bank |
Hatton National and Amana Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hatton National and Amana Bank
The main advantage of trading using opposite Hatton National and Amana Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hatton National 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.| Hatton National vs. Trans Asia Hotels | Hatton National vs. Mahaweli Reach Hotel | Hatton National vs. BROWNS INVESTMENTS PLC | Hatton National vs. Softlogic Life Insurance |
| Amana Bank vs. Nuwara Eliya Hotels | Amana Bank vs. Eden Hotel Lanka | Amana Bank vs. SERENDIB HOTELS PLC | Amana Bank vs. Galadari Hotels Lanka |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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