Correlation Between John Keells and Aitken Spence
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By analyzing existing cross correlation between John Keells Hotels and Aitken Spence Hotel, you can compare the effects of market volatilities on John Keells 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 John Keells with a short position of Aitken Spence. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Keells and Aitken Spence.
Diversification Opportunities for John Keells and Aitken Spence
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between John and Aitken is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding John Keells Hotels 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 John Keells 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 John Keells Hotels 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 John Keells i.e., John Keells and Aitken Spence go up and down completely randomly.
Pair Corralation between John Keells and Aitken Spence
Assuming the 90 days trading horizon John Keells is expected to generate 1.64 times less return on investment than Aitken Spence. But when comparing it to its historical volatility, John Keells Hotels is 1.11 times less risky than Aitken Spence. It trades about 0.14 of its potential returns per unit of risk. Aitken Spence Hotel is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 5,990 in Aitken Spence Hotel on August 30, 2024 and sell it today you would earn a total of 470.00 from holding Aitken Spence Hotel or generate 7.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
John Keells Hotels vs. Aitken Spence Hotel
Performance |
| Timeline |
| John Keells Hotels |
| Aitken Spence Hotel |
John Keells and Aitken Spence Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Keells and Aitken Spence
The main advantage of trading using opposite John Keells and Aitken Spence positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Keells 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.| John Keells vs. EX PACK RUGATED CARTONS | John Keells vs. PANASIAN POWER PLC | John Keells vs. Distilleries Company of | John Keells vs. Palm Garden Hotels |
| Aitken Spence vs. EX PACK RUGATED CARTONS | Aitken Spence vs. PANASIAN POWER PLC | Aitken Spence vs. Distilleries Company of | Aitken Spence vs. Palm Garden Hotels |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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