Correlation Between Hatton National and Ceylon Cold
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By analyzing existing cross correlation between Hatton National Bank and Ceylon Cold Stores, you can compare the effects of market volatilities on Hatton National and Ceylon Cold 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 Ceylon Cold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hatton National and Ceylon Cold.
Diversification Opportunities for Hatton National and Ceylon Cold
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hatton and Ceylon is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Hatton National Bank and Ceylon Cold Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ceylon Cold Stores 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 Ceylon Cold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ceylon Cold Stores has no effect on the direction of Hatton National i.e., Hatton National and Ceylon Cold go up and down completely randomly.
Pair Corralation between Hatton National and Ceylon Cold
Assuming the 90 days trading horizon Hatton National is expected to generate 1.07 times less return on investment than Ceylon Cold. In addition to that, Hatton National is 1.25 times more volatile than Ceylon Cold Stores. It trades about 0.26 of its total potential returns per unit of risk. Ceylon Cold Stores is currently generating about 0.35 per unit of volatility. If you would invest 8,250 in Ceylon Cold Stores on November 4, 2024 and sell it today you would earn a total of 900.00 from holding Ceylon Cold Stores or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hatton National Bank vs. Ceylon Cold Stores
Performance |
| Timeline |
| Hatton National Bank |
| Ceylon Cold Stores |
Hatton National and Ceylon Cold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hatton National and Ceylon Cold
The main advantage of trading using opposite Hatton National and Ceylon Cold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hatton National position performs unexpectedly, Ceylon Cold 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 Ceylon Cold will offset losses from the drop in Ceylon Cold's long position.| Hatton National vs. Renuka Agri Foods | Hatton National vs. Asiri Surgical Hospital | Hatton National vs. RENUKA FOODS PLC | Hatton National vs. Convenience Foods PLC |
| Ceylon Cold vs. Ceylon Guardian Investment | Ceylon Cold vs. BROWNS INVESTMENTS PLC | Ceylon Cold vs. Distilleries Company of | Ceylon Cold vs. Union Chemicals 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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