Correlation Between Pan Asia and Sri Lanka
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By analyzing existing cross correlation between Pan Asia Banking and Sri Lanka Telecom, you can compare the effects of market volatilities on Pan Asia and Sri Lanka 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 Sri Lanka. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Asia and Sri Lanka.
Diversification Opportunities for Pan Asia and Sri Lanka
Very weak diversification
The 3 months correlation between Pan and Sri is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Pan Asia Banking and Sri Lanka Telecom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sri Lanka Telecom 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 Sri Lanka. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sri Lanka Telecom has no effect on the direction of Pan Asia i.e., Pan Asia and Sri Lanka go up and down completely randomly.
Pair Corralation between Pan Asia and Sri Lanka
Assuming the 90 days trading horizon Pan Asia Banking is expected to generate 0.83 times more return on investment than Sri Lanka. However, Pan Asia Banking is 1.21 times less risky than Sri Lanka. It trades about 0.11 of its potential returns per unit of risk. Sri Lanka Telecom is currently generating about -0.09 per unit of risk. If you would invest 2,170 in Pan Asia Banking on August 30, 2024 and sell it today you would earn a total of 520.00 from holding Pan Asia Banking or generate 23.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pan Asia Banking vs. Sri Lanka Telecom
Performance |
| Timeline |
| Pan Asia Banking |
| Sri Lanka Telecom |
Pan Asia and Sri Lanka Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Asia and Sri Lanka
The main advantage of trading using opposite Pan Asia and Sri Lanka positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Asia position performs unexpectedly, Sri Lanka 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 Sri Lanka will offset losses from the drop in Sri Lanka's long position.| Pan Asia vs. EX PACK RUGATED CARTONS | Pan Asia vs. PANASIAN POWER PLC | Pan Asia vs. Distilleries Company of | Pan Asia vs. Palm Garden Hotels |
| Sri Lanka vs. EX PACK RUGATED CARTONS | Sri Lanka vs. PANASIAN POWER PLC | Sri Lanka vs. Distilleries Company of | Sri Lanka 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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