Correlation Between Hotel Sigiriya and Aitken Spence
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By analyzing existing cross correlation between Hotel Sigiriya PLC and Aitken Spence Hotel, you can compare the effects of market volatilities on Hotel Sigiriya and Aitken Spence 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 Hotel Sigiriya with a short position of Aitken Spence. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Sigiriya and Aitken Spence.
Diversification Opportunities for Hotel Sigiriya and Aitken Spence
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hotel and Aitken is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Sigiriya PLC and Aitken Spence Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aitken Spence Hotel and Hotel Sigiriya 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 Hotel Sigiriya PLC are associated (or correlated) with Aitken Spence. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aitken Spence Hotel has no effect on the direction of Hotel Sigiriya i.e., Hotel Sigiriya and Aitken Spence go up and down completely randomly.
Pair Corralation between Hotel Sigiriya and Aitken Spence
Assuming the 90 days trading horizon Hotel Sigiriya PLC is expected to generate 1.63 times more return on investment than Aitken Spence. However, Hotel Sigiriya is 1.63 times more volatile than Aitken Spence Hotel. It trades about 0.04 of its potential returns per unit of risk. Aitken Spence Hotel is currently generating about 0.02 per unit of risk. If you would invest 5,300 in Hotel Sigiriya PLC on August 27, 2024 and sell it today you would earn a total of 650.00 from holding Hotel Sigiriya PLC or generate 12.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.86% |
| Values | Daily Returns |
Hotel Sigiriya PLC vs. Aitken Spence Hotel
Performance |
| Timeline |
| Hotel Sigiriya PLC |
| Aitken Spence Hotel |
Hotel Sigiriya and Aitken Spence Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotel Sigiriya and Aitken Spence
The main advantage of trading using opposite Hotel Sigiriya and Aitken Spence positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Sigiriya position performs unexpectedly, Aitken Spence 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 Aitken Spence will offset losses from the drop in Aitken Spence's long position.| Hotel Sigiriya vs. Sigiriya Village Hotels | Hotel Sigiriya vs. Browns Beach Hotels | Hotel Sigiriya vs. Ceylinco Insurance PLC | Hotel Sigiriya vs. Trans Asia Hotels |
| Aitken Spence vs. John Keells Hotels | Aitken Spence vs. Eden Hotel Lanka | Aitken Spence vs. HVA Foods PLC | Aitken Spence vs. Lighthouse Hotel PLC |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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