Correlation Between Jat Holdings and Elpitiya Plantations
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By analyzing existing cross correlation between Jat Holdings PLC and Elpitiya Plantations PLC, you can compare the effects of market volatilities on Jat Holdings and Elpitiya Plantations 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 Jat Holdings with a short position of Elpitiya Plantations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jat Holdings and Elpitiya Plantations.
Diversification Opportunities for Jat Holdings and Elpitiya Plantations
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jat and Elpitiya is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Jat Holdings PLC and Elpitiya Plantations PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elpitiya Plantations PLC and Jat Holdings 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 Jat Holdings PLC are associated (or correlated) with Elpitiya Plantations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elpitiya Plantations PLC has no effect on the direction of Jat Holdings i.e., Jat Holdings and Elpitiya Plantations go up and down completely randomly.
Pair Corralation between Jat Holdings and Elpitiya Plantations
Assuming the 90 days trading horizon Jat Holdings PLC is expected to generate 1.13 times more return on investment than Elpitiya Plantations. However, Jat Holdings is 1.13 times more volatile than Elpitiya Plantations PLC. It trades about 0.19 of its potential returns per unit of risk. Elpitiya Plantations PLC is currently generating about 0.18 per unit of risk. If you would invest 1,590 in Jat Holdings PLC on September 2, 2024 and sell it today you would earn a total of 370.00 from holding Jat Holdings PLC or generate 23.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jat Holdings PLC vs. Elpitiya Plantations PLC
Performance |
| Timeline |
| Jat Holdings PLC |
| Elpitiya Plantations PLC |
Jat Holdings and Elpitiya Plantations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jat Holdings and Elpitiya Plantations
The main advantage of trading using opposite Jat Holdings and Elpitiya Plantations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jat Holdings position performs unexpectedly, Elpitiya Plantations 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 Elpitiya Plantations will offset losses from the drop in Elpitiya Plantations' long position.| Jat Holdings vs. Prime Lands Residencies | Jat Holdings vs. VIDULLANKA PLC | Jat Holdings vs. EX PACK RUGATED CARTONS |
| Elpitiya Plantations vs. HVA Foods PLC | Elpitiya Plantations vs. Convenience Foods PLC | Elpitiya Plantations vs. Aitken Spence Hotel | Elpitiya Plantations vs. Ceylon Beverage Holdings |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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