Correlation Between Seylan Bank and PEOPLES LEASING
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By analyzing existing cross correlation between Seylan Bank PLC and PEOPLES LEASING FINANCE, you can compare the effects of market volatilities on Seylan Bank and PEOPLES LEASING 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 Seylan Bank with a short position of PEOPLES LEASING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seylan Bank and PEOPLES LEASING.
Diversification Opportunities for Seylan Bank and PEOPLES LEASING
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Seylan and PEOPLES is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Seylan Bank PLC and PEOPLES LEASING FINANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEOPLES LEASING FINANCE and Seylan Bank 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 Seylan Bank PLC are associated (or correlated) with PEOPLES LEASING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEOPLES LEASING FINANCE has no effect on the direction of Seylan Bank i.e., Seylan Bank and PEOPLES LEASING go up and down completely randomly.
Pair Corralation between Seylan Bank and PEOPLES LEASING
Assuming the 90 days trading horizon Seylan Bank PLC is expected to generate 1.06 times more return on investment than PEOPLES LEASING. However, Seylan Bank is 1.06 times more volatile than PEOPLES LEASING FINANCE. It trades about 0.27 of its potential returns per unit of risk. PEOPLES LEASING FINANCE is currently generating about 0.03 per unit of risk. If you would invest 5,000 in Seylan Bank PLC on August 24, 2024 and sell it today you would earn a total of 400.00 from holding Seylan Bank PLC or generate 8.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seylan Bank PLC vs. PEOPLES LEASING FINANCE
Performance |
| Timeline |
| Seylan Bank PLC |
| PEOPLES LEASING FINANCE |
Seylan Bank and PEOPLES LEASING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seylan Bank and PEOPLES LEASING
The main advantage of trading using opposite Seylan Bank and PEOPLES LEASING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seylan Bank position performs unexpectedly, PEOPLES LEASING 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 PEOPLES LEASING will offset losses from the drop in PEOPLES LEASING's long position.| Seylan Bank vs. John Keells Hotels | Seylan Bank vs. Browns Beach Hotels | Seylan Bank vs. ACL Plastics PLC | Seylan Bank vs. Ceylon Tobacco |
| PEOPLES LEASING vs. Jat Holdings PLC | PEOPLES LEASING vs. Lanka Credit and | PEOPLES LEASING vs. Carson Cumberbatch PLC | PEOPLES LEASING vs. Mahaweli Reach Hotel |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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