Correlation Between Janashakthi Insurance and Eden Hotel
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By analyzing existing cross correlation between Janashakthi Insurance and Eden Hotel Lanka, you can compare the effects of market volatilities on Janashakthi Insurance and Eden Hotel 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 Janashakthi Insurance with a short position of Eden Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Janashakthi Insurance and Eden Hotel.
Diversification Opportunities for Janashakthi Insurance and Eden Hotel
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Janashakthi and Eden is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Janashakthi Insurance and Eden Hotel Lanka in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eden Hotel Lanka and Janashakthi Insurance 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 Janashakthi Insurance are associated (or correlated) with Eden Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eden Hotel Lanka has no effect on the direction of Janashakthi Insurance i.e., Janashakthi Insurance and Eden Hotel go up and down completely randomly.
Pair Corralation between Janashakthi Insurance and Eden Hotel
Assuming the 90 days trading horizon Janashakthi Insurance is expected to generate 1.06 times more return on investment than Eden Hotel. However, Janashakthi Insurance is 1.06 times more volatile than Eden Hotel Lanka. It trades about 0.06 of its potential returns per unit of risk. Eden Hotel Lanka is currently generating about 0.0 per unit of risk. If you would invest 2,320 in Janashakthi Insurance on August 31, 2024 and sell it today you would earn a total of 2,190 from holding Janashakthi Insurance or generate 94.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.52% |
| Values | Daily Returns |
Janashakthi Insurance vs. Eden Hotel Lanka
Performance |
| Timeline |
| Janashakthi Insurance |
| Eden Hotel Lanka |
Janashakthi Insurance and Eden Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Janashakthi Insurance and Eden Hotel
The main advantage of trading using opposite Janashakthi Insurance and Eden Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Janashakthi Insurance position performs unexpectedly, Eden Hotel 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 Eden Hotel will offset losses from the drop in Eden Hotel's long position.| Janashakthi Insurance vs. HNB Finance | Janashakthi Insurance vs. Prime Lands Residencies | Janashakthi Insurance vs. Jat Holdings PLC | Janashakthi Insurance vs. E M L |
| Eden Hotel vs. Janashakthi Insurance | Eden Hotel vs. CEYLON HOSPITALS PLC | Eden Hotel vs. BROWNS INVESTMENTS PLC | Eden Hotel vs. Sampath 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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