Correlation Between Lanka Credit and Citrus Leisure
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By analyzing existing cross correlation between Lanka Credit and and Citrus Leisure PLC, you can compare the effects of market volatilities on Lanka Credit and Citrus Leisure 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 Lanka Credit with a short position of Citrus Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lanka Credit and Citrus Leisure.
Diversification Opportunities for Lanka Credit and Citrus Leisure
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lanka and Citrus is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Lanka Credit and and Citrus Leisure PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citrus Leisure PLC and Lanka Credit 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 Lanka Credit and are associated (or correlated) with Citrus Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citrus Leisure PLC has no effect on the direction of Lanka Credit i.e., Lanka Credit and Citrus Leisure go up and down completely randomly.
Pair Corralation between Lanka Credit and Citrus Leisure
Assuming the 90 days trading horizon Lanka Credit and is expected to generate 1.2 times more return on investment than Citrus Leisure. However, Lanka Credit is 1.2 times more volatile than Citrus Leisure PLC. It trades about 0.01 of its potential returns per unit of risk. Citrus Leisure PLC is currently generating about -0.01 per unit of risk. If you would invest 240.00 in Lanka Credit and on August 27, 2024 and sell it today you would lose (30.00) from holding Lanka Credit and or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.31% |
| Values | Daily Returns |
Lanka Credit and vs. Citrus Leisure PLC
Performance |
| Timeline |
| Lanka Credit |
| Citrus Leisure PLC |
Lanka Credit and Citrus Leisure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lanka Credit and Citrus Leisure
The main advantage of trading using opposite Lanka Credit and Citrus Leisure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lanka Credit position performs unexpectedly, Citrus Leisure 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 Citrus Leisure will offset losses from the drop in Citrus Leisure's long position.| Lanka Credit vs. Sigiriya Village Hotels | Lanka Credit vs. Union Chemicals Lanka | Lanka Credit vs. Sri Lanka Telecom | Lanka Credit vs. Distilleries Company of |
| Citrus Leisure vs. Hatton National Bank | Citrus Leisure vs. CEYLON HOSPITALS PLC | Citrus Leisure vs. HVA Foods PLC | Citrus Leisure vs. Convenience Foods 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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