Correlation Between Merchant Bank and EB Creasy
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By analyzing existing cross correlation between Merchant Bank of and EB Creasy and, you can compare the effects of market volatilities on Merchant Bank and EB Creasy 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 Merchant Bank with a short position of EB Creasy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merchant Bank and EB Creasy.
Diversification Opportunities for Merchant Bank and EB Creasy
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Merchant and EBCRN0000 is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Merchant Bank of and EB Creasy and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EB Creasy and Merchant Bank 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 Merchant Bank of are associated (or correlated) with EB Creasy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EB Creasy has no effect on the direction of Merchant Bank i.e., Merchant Bank and EB Creasy go up and down completely randomly.
Pair Corralation between Merchant Bank and EB Creasy
Assuming the 90 days trading horizon Merchant Bank of is expected to generate 1.48 times more return on investment than EB Creasy. However, Merchant Bank is 1.48 times more volatile than EB Creasy and. It trades about 0.05 of its potential returns per unit of risk. EB Creasy and is currently generating about 0.03 per unit of risk. If you would invest 340.00 in Merchant Bank of on September 14, 2024 and sell it today you would earn a total of 230.00 from holding Merchant Bank of or generate 67.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.48% |
| Values | Daily Returns |
Merchant Bank of vs. EB Creasy and
Performance |
| Timeline |
| Merchant Bank |
| EB Creasy |
Merchant Bank and EB Creasy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merchant Bank and EB Creasy
The main advantage of trading using opposite Merchant Bank and EB Creasy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merchant Bank position performs unexpectedly, EB Creasy 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 EB Creasy will offset losses from the drop in EB Creasy's long position.| Merchant Bank vs. Jat Holdings PLC | Merchant Bank vs. Lanka Credit and | Merchant Bank vs. VIDULLANKA PLC | Merchant Bank vs. Carson Cumberbatch PLC |
| EB Creasy vs. Softlogic Life Insurance | EB Creasy vs. Lanka Milk Foods | EB Creasy vs. DFCC Bank PLC | EB Creasy vs. Merchant Bank of |
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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