Correlation Between Jat Holdings and John Keells
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By analyzing existing cross correlation between Jat Holdings PLC and John Keells Hotels, you can compare the effects of market volatilities on Jat Holdings and John Keells 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 John Keells. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jat Holdings and John Keells.
Diversification Opportunities for Jat Holdings and John Keells
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jat and John is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jat Holdings PLC and John Keells Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Keells Hotels 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 John Keells. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Keells Hotels has no effect on the direction of Jat Holdings i.e., Jat Holdings and John Keells go up and down completely randomly.
Pair Corralation between Jat Holdings and John Keells
Assuming the 90 days trading horizon Jat Holdings PLC is expected to generate 1.18 times more return on investment than John Keells. However, Jat Holdings is 1.18 times more volatile than John Keells Hotels. It trades about 0.21 of its potential returns per unit of risk. John Keells Hotels is currently generating about 0.2 per unit of risk. If you would invest 1,800 in Jat Holdings PLC on September 1, 2024 and sell it today you would earn a total of 160.00 from holding Jat Holdings PLC or generate 8.89% 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. John Keells Hotels
Performance |
| Timeline |
| Jat Holdings PLC |
| John Keells Hotels |
Jat Holdings and John Keells Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jat Holdings and John Keells
The main advantage of trading using opposite Jat Holdings and John Keells positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jat Holdings position performs unexpectedly, John Keells 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 John Keells will offset losses from the drop in John Keells' long position.| Jat Holdings vs. Prime Lands Residencies | Jat Holdings vs. E M L | Jat Holdings vs. Lanka Credit and | Jat Holdings vs. VIDULLANKA PLC |
| John Keells vs. Prime Lands Residencies | John Keells vs. Jat Holdings PLC | John Keells vs. E M L | John Keells vs. Lanka Credit and |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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