Correlation Between PANASIAN POWER and Browns Beach
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By analyzing existing cross correlation between PANASIAN POWER PLC and Browns Beach Hotels, you can compare the effects of market volatilities on PANASIAN POWER and Browns Beach 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 PANASIAN POWER with a short position of Browns Beach. Check out your portfolio center. Please also check ongoing floating volatility patterns of PANASIAN POWER and Browns Beach.
Diversification Opportunities for PANASIAN POWER and Browns Beach
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PANASIAN and Browns is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding PANASIAN POWER PLC and Browns Beach Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Browns Beach Hotels and PANASIAN POWER 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 PANASIAN POWER PLC are associated (or correlated) with Browns Beach. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Browns Beach Hotels has no effect on the direction of PANASIAN POWER i.e., PANASIAN POWER and Browns Beach go up and down completely randomly.
Pair Corralation between PANASIAN POWER and Browns Beach
Assuming the 90 days trading horizon PANASIAN POWER PLC is expected to generate 1.14 times more return on investment than Browns Beach. However, PANASIAN POWER is 1.14 times more volatile than Browns Beach Hotels. It trades about -0.17 of its potential returns per unit of risk. Browns Beach Hotels is currently generating about -0.34 per unit of risk. If you would invest 850.00 in PANASIAN POWER PLC on November 28, 2024 and sell it today you would lose (80.00) from holding PANASIAN POWER PLC or give up 9.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.48% |
| Values | Daily Returns |
PANASIAN POWER PLC vs. Browns Beach Hotels
Performance |
| Timeline |
| PANASIAN POWER PLC |
| Browns Beach Hotels |
PANASIAN POWER and Browns Beach Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PANASIAN POWER and Browns Beach
The main advantage of trading using opposite PANASIAN POWER and Browns Beach positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PANASIAN POWER position performs unexpectedly, Browns Beach 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 Browns Beach will offset losses from the drop in Browns Beach's long position.| PANASIAN POWER vs. Lion Brewery Ceylon | PANASIAN POWER vs. Union Chemicals Lanka | PANASIAN POWER vs. Renuka Agri Foods | PANASIAN POWER vs. HVA Foods PLC |
| Browns Beach vs. PEOPLES LEASING FINANCE | Browns Beach vs. HATTON NATIONAL BANK | Browns Beach vs. National Development Bank | Browns Beach vs. COMMERCIAL 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 Stocks Directory module to find actively traded stocks across global markets.
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