Correlation Between Pan Asia and Mahaweli Reach
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By analyzing existing cross correlation between Pan Asia Banking and Mahaweli Reach Hotel, you can compare the effects of market volatilities on Pan Asia and Mahaweli Reach 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 Pan Asia with a short position of Mahaweli Reach. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Asia and Mahaweli Reach.
Diversification Opportunities for Pan Asia and Mahaweli Reach
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pan and Mahaweli is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Pan Asia Banking and Mahaweli Reach Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mahaweli Reach Hotel and Pan Asia 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 Pan Asia Banking are associated (or correlated) with Mahaweli Reach. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mahaweli Reach Hotel has no effect on the direction of Pan Asia i.e., Pan Asia and Mahaweli Reach go up and down completely randomly.
Pair Corralation between Pan Asia and Mahaweli Reach
Assuming the 90 days trading horizon Pan Asia Banking is expected to generate 1.17 times more return on investment than Mahaweli Reach. However, Pan Asia is 1.17 times more volatile than Mahaweli Reach Hotel. It trades about -0.15 of its potential returns per unit of risk. Mahaweli Reach Hotel is currently generating about -0.21 per unit of risk. If you would invest 3,910 in Pan Asia Banking on November 28, 2024 and sell it today you would lose (310.00) from holding Pan Asia Banking or give up 7.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Pan Asia Banking vs. Mahaweli Reach Hotel
Performance |
| Timeline |
| Pan Asia Banking |
| Mahaweli Reach Hotel |
Pan Asia and Mahaweli Reach Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Asia and Mahaweli Reach
The main advantage of trading using opposite Pan Asia and Mahaweli Reach positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Asia position performs unexpectedly, Mahaweli Reach 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 Mahaweli Reach will offset losses from the drop in Mahaweli Reach's long position.| Pan Asia vs. BROWNS INVESTMENTS PLC | Pan Asia vs. Nations Trust Bank | Pan Asia vs. Amaya Leisure PLC | Pan Asia vs. PEOPLES LEASING FINANCE |
| Mahaweli Reach vs. HVA Foods PLC | Mahaweli Reach vs. Colombo Investment Trust | Mahaweli Reach vs. Singhe Hospitals | Mahaweli Reach vs. BROWNS INVESTMENTS 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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