Correlation Between Seylan Bank and Sampath Bank
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By analyzing existing cross correlation between Seylan Bank PLC and Sampath Bank PLC, you can compare the effects of market volatilities on Seylan Bank and Sampath Bank 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 Sampath Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seylan Bank and Sampath Bank.
Diversification Opportunities for Seylan Bank and Sampath Bank
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Seylan and Sampath is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Seylan Bank PLC and Sampath Bank PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sampath Bank PLC 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 Sampath Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sampath Bank PLC has no effect on the direction of Seylan Bank i.e., Seylan Bank and Sampath Bank go up and down completely randomly.
Pair Corralation between Seylan Bank and Sampath Bank
Assuming the 90 days trading horizon Seylan Bank is expected to generate 1.04 times less return on investment than Sampath Bank. In addition to that, Seylan Bank is 1.38 times more volatile than Sampath Bank PLC. It trades about 0.1 of its total potential returns per unit of risk. Sampath Bank PLC is currently generating about 0.15 per unit of volatility. If you would invest 7,780 in Sampath Bank PLC on August 31, 2024 and sell it today you would earn a total of 2,000 from holding Sampath Bank PLC or generate 25.71% 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. Sampath Bank PLC
Performance |
| Timeline |
| Seylan Bank PLC |
| Sampath Bank PLC |
Seylan Bank and Sampath Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seylan Bank and Sampath Bank
The main advantage of trading using opposite Seylan Bank and Sampath Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seylan Bank position performs unexpectedly, Sampath Bank 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 Sampath Bank will offset losses from the drop in Sampath Bank's long position.| Seylan Bank vs. Tal Lanka Hotels | Seylan Bank vs. Serendib Hotels PLC | Seylan Bank vs. Asian Hotels and | Seylan Bank vs. Browns Beach Hotels |
| Sampath Bank vs. HNB Finance | Sampath Bank vs. Prime Lands Residencies | Sampath Bank vs. Jat Holdings PLC | Sampath Bank vs. E M L |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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