Correlation Between Lanka Milk and PEOPLES LEASING
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By analyzing existing cross correlation between Lanka Milk Foods and PEOPLES LEASING FINANCE, you can compare the effects of market volatilities on Lanka Milk and PEOPLES LEASING 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 Milk with a short position of PEOPLES LEASING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lanka Milk and PEOPLES LEASING.
Diversification Opportunities for Lanka Milk and PEOPLES LEASING
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lanka and PEOPLES is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Lanka Milk Foods and PEOPLES LEASING FINANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEOPLES LEASING FINANCE and Lanka Milk 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 Milk Foods are associated (or correlated) with PEOPLES LEASING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEOPLES LEASING FINANCE has no effect on the direction of Lanka Milk i.e., Lanka Milk and PEOPLES LEASING go up and down completely randomly.
Pair Corralation between Lanka Milk and PEOPLES LEASING
Assuming the 90 days trading horizon Lanka Milk Foods is expected to generate 1.76 times more return on investment than PEOPLES LEASING. However, Lanka Milk is 1.76 times more volatile than PEOPLES LEASING FINANCE. It trades about 0.15 of its potential returns per unit of risk. PEOPLES LEASING FINANCE is currently generating about 0.0 per unit of risk. If you would invest 3,070 in Lanka Milk Foods on August 30, 2024 and sell it today you would earn a total of 160.00 from holding Lanka Milk Foods or generate 5.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lanka Milk Foods vs. PEOPLES LEASING FINANCE
Performance |
| Timeline |
| Lanka Milk Foods |
| PEOPLES LEASING FINANCE |
Lanka Milk and PEOPLES LEASING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lanka Milk and PEOPLES LEASING
The main advantage of trading using opposite Lanka Milk and PEOPLES LEASING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lanka Milk position performs unexpectedly, PEOPLES LEASING 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 PEOPLES LEASING will offset losses from the drop in PEOPLES LEASING's long position.| Lanka Milk vs. Browns Beach Hotels | Lanka Milk vs. Ceylon Hotels | Lanka Milk vs. Hotel Sigiriya PLC | Lanka Milk vs. Tal Lanka Hotels |
| PEOPLES LEASING vs. EX PACK RUGATED CARTONS | PEOPLES LEASING vs. PANASIAN POWER PLC | PEOPLES LEASING vs. Distilleries Company of | PEOPLES LEASING 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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