Correlation Between Mahaweli Reach and Singhe Hospitals
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By analyzing existing cross correlation between Mahaweli Reach Hotel and Singhe Hospitals, you can compare the effects of market volatilities on Mahaweli Reach and Singhe Hospitals 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 Singhe Hospitals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mahaweli Reach and Singhe Hospitals.
Diversification Opportunities for Mahaweli Reach and Singhe Hospitals
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mahaweli and Singhe is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Mahaweli Reach Hotel and Singhe Hospitals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singhe Hospitals 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 Singhe Hospitals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singhe Hospitals has no effect on the direction of Mahaweli Reach i.e., Mahaweli Reach and Singhe Hospitals go up and down completely randomly.
Pair Corralation between Mahaweli Reach and Singhe Hospitals
Assuming the 90 days trading horizon Mahaweli Reach is expected to generate 23.56 times less return on investment than Singhe Hospitals. But when comparing it to its historical volatility, Mahaweli Reach Hotel is 1.88 times less risky than Singhe Hospitals. It trades about 0.01 of its potential returns per unit of risk. Singhe Hospitals is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 260.00 in Singhe Hospitals on November 3, 2024 and sell it today you would earn a total of 30.00 from holding Singhe Hospitals or generate 11.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Mahaweli Reach Hotel vs. Singhe Hospitals
Performance |
| Timeline |
| Mahaweli Reach Hotel |
| Singhe Hospitals |
Mahaweli Reach and Singhe Hospitals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mahaweli Reach and Singhe Hospitals
The main advantage of trading using opposite Mahaweli Reach and Singhe Hospitals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mahaweli Reach position performs unexpectedly, Singhe Hospitals 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 Singhe Hospitals will offset losses from the drop in Singhe Hospitals' long position.| Mahaweli Reach vs. HNB Finance | Mahaweli Reach vs. Prime Lands Residencies | Mahaweli Reach vs. Jat Holdings PLC | Mahaweli Reach vs. E M L |
| Singhe Hospitals vs. HATTON NATIONAL BANK | Singhe Hospitals vs. Keells Food Products | Singhe Hospitals vs. Carson Cumberbatch PLC | Singhe Hospitals vs. Seylan Bank 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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