Correlation Between Jat Holdings and Mahaweli Reach
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By analyzing existing cross correlation between Jat Holdings PLC and Mahaweli Reach Hotel, you can compare the effects of market volatilities on Jat Holdings and Mahaweli Reach 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 Mahaweli Reach. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jat Holdings and Mahaweli Reach.
Diversification Opportunities for Jat Holdings and Mahaweli Reach
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jat and Mahaweli is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Jat Holdings PLC and Mahaweli Reach Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mahaweli Reach Hotel 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 Mahaweli Reach. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mahaweli Reach Hotel has no effect on the direction of Jat Holdings i.e., Jat Holdings and Mahaweli Reach go up and down completely randomly.
Pair Corralation between Jat Holdings and Mahaweli Reach
Assuming the 90 days trading horizon Jat Holdings is expected to generate 2.62 times less return on investment than Mahaweli Reach. But when comparing it to its historical volatility, Jat Holdings PLC is 1.58 times less risky than Mahaweli Reach. It trades about 0.1 of its potential returns per unit of risk. Mahaweli Reach Hotel is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,310 in Mahaweli Reach Hotel on August 28, 2024 and sell it today you would earn a total of 420.00 from holding Mahaweli Reach Hotel or generate 32.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.92% |
| Values | Daily Returns |
Jat Holdings PLC vs. Mahaweli Reach Hotel
Performance |
| Timeline |
| Jat Holdings PLC |
| Mahaweli Reach Hotel |
Jat Holdings and Mahaweli Reach Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jat Holdings and Mahaweli Reach
The main advantage of trading using opposite Jat Holdings and Mahaweli Reach positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jat Holdings position performs unexpectedly, Mahaweli Reach 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 Mahaweli Reach will offset losses from the drop in Mahaweli Reach's long position.| Jat Holdings vs. Convenience Foods PLC | Jat Holdings vs. Pegasus Hotels of | Jat Holdings vs. Arpico Insurance | Jat Holdings vs. RENUKA FOODS PLC |
| Mahaweli Reach vs. Dolphin Hotels PLC | Mahaweli Reach vs. HATTON NATIONAL BANK | Mahaweli Reach vs. Sri Lanka Telecom | Mahaweli Reach vs. Seylan Bank 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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