Correlation Between Mahaweli Reach and Janashakthi Insurance
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By analyzing existing cross correlation between Mahaweli Reach Hotel and Janashakthi Insurance, you can compare the effects of market volatilities on Mahaweli Reach and Janashakthi Insurance 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 Mahaweli Reach with a short position of Janashakthi Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mahaweli Reach and Janashakthi Insurance.
Diversification Opportunities for Mahaweli Reach and Janashakthi Insurance
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mahaweli and Janashakthi is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Mahaweli Reach Hotel and Janashakthi Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janashakthi Insurance and Mahaweli Reach 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 Mahaweli Reach Hotel are associated (or correlated) with Janashakthi Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janashakthi Insurance has no effect on the direction of Mahaweli Reach i.e., Mahaweli Reach and Janashakthi Insurance go up and down completely randomly.
Pair Corralation between Mahaweli Reach and Janashakthi Insurance
Assuming the 90 days trading horizon Mahaweli Reach Hotel is expected to generate 1.6 times more return on investment than Janashakthi Insurance. However, Mahaweli Reach is 1.6 times more volatile than Janashakthi Insurance. It trades about 0.3 of its potential returns per unit of risk. Janashakthi Insurance is currently generating about 0.01 per unit of risk. If you would invest 1,410 in Mahaweli Reach Hotel on August 28, 2024 and sell it today you would earn a total of 320.00 from holding Mahaweli Reach Hotel or generate 22.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Mahaweli Reach Hotel vs. Janashakthi Insurance
Performance |
| Timeline |
| Mahaweli Reach Hotel |
| Janashakthi Insurance |
Mahaweli Reach and Janashakthi Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mahaweli Reach and Janashakthi Insurance
The main advantage of trading using opposite Mahaweli Reach and Janashakthi Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mahaweli Reach position performs unexpectedly, Janashakthi Insurance 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 Janashakthi Insurance will offset losses from the drop in Janashakthi Insurance's long position.| Mahaweli Reach vs. Hotel Sigiriya PLC | Mahaweli Reach vs. Sri Lanka Telecom | Mahaweli Reach vs. Asiri Surgical Hospital | Mahaweli Reach vs. Galadari Hotels Lanka |
| Janashakthi Insurance vs. HVA Foods PLC | Janashakthi Insurance vs. Citrus Leisure PLC | Janashakthi Insurance vs. Union Chemicals Lanka | Janashakthi Insurance vs. RENUKA 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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