Correlation Between Lighthouse Hotel and Distilleries Company
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By analyzing existing cross correlation between Lighthouse Hotel PLC and Distilleries Company of, you can compare the effects of market volatilities on Lighthouse Hotel and Distilleries Company 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 Lighthouse Hotel with a short position of Distilleries Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lighthouse Hotel and Distilleries Company.
Diversification Opportunities for Lighthouse Hotel and Distilleries Company
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lighthouse and Distilleries is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Lighthouse Hotel PLC and Distilleries Company of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Distilleries Company and Lighthouse Hotel 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 Lighthouse Hotel PLC are associated (or correlated) with Distilleries Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Distilleries Company has no effect on the direction of Lighthouse Hotel i.e., Lighthouse Hotel and Distilleries Company go up and down completely randomly.
Pair Corralation between Lighthouse Hotel and Distilleries Company
Assuming the 90 days trading horizon Lighthouse Hotel PLC is expected to generate 1.5 times more return on investment than Distilleries Company. However, Lighthouse Hotel is 1.5 times more volatile than Distilleries Company of. It trades about 0.1 of its potential returns per unit of risk. Distilleries Company of is currently generating about 0.11 per unit of risk. If you would invest 4,720 in Lighthouse Hotel PLC on February 4, 2025 and sell it today you would earn a total of 1,340 from holding Lighthouse Hotel PLC or generate 28.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Lighthouse Hotel PLC vs. Distilleries Company of
Performance |
| Timeline |
| Lighthouse Hotel PLC |
| Distilleries Company |
Lighthouse Hotel and Distilleries Company Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lighthouse Hotel and Distilleries Company
The main advantage of trading using opposite Lighthouse Hotel and Distilleries Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lighthouse Hotel position performs unexpectedly, Distilleries Company 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 Distilleries Company will offset losses from the drop in Distilleries Company's long position.| Lighthouse Hotel vs. HNB Finance | Lighthouse Hotel vs. Prime Lands Residencies | Lighthouse Hotel vs. Jat Holdings PLC | Lighthouse Hotel vs. E M L |
| Distilleries Company vs. RENUKA FOODS PLC | Distilleries Company vs. Renuka City Hotel | Distilleries Company vs. Lanka Milk Foods | Distilleries Company vs. Galadari Hotels Lanka |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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