Correlation Between SERENDIB HOTELS and Aitken Spence
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By analyzing existing cross correlation between SERENDIB HOTELS PLC and Aitken Spence Hotel, you can compare the effects of market volatilities on SERENDIB HOTELS and Aitken Spence 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 SERENDIB HOTELS with a short position of Aitken Spence. Check out your portfolio center. Please also check ongoing floating volatility patterns of SERENDIB HOTELS and Aitken Spence.
Diversification Opportunities for SERENDIB HOTELS and Aitken Spence
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SERENDIB and Aitken is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding SERENDIB HOTELS PLC and Aitken Spence Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aitken Spence Hotel and SERENDIB HOTELS 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 SERENDIB HOTELS PLC are associated (or correlated) with Aitken Spence. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aitken Spence Hotel has no effect on the direction of SERENDIB HOTELS i.e., SERENDIB HOTELS and Aitken Spence go up and down completely randomly.
Pair Corralation between SERENDIB HOTELS and Aitken Spence
Assuming the 90 days trading horizon SERENDIB HOTELS PLC is expected to generate 1.53 times more return on investment than Aitken Spence. However, SERENDIB HOTELS is 1.53 times more volatile than Aitken Spence Hotel. It trades about 0.24 of its potential returns per unit of risk. Aitken Spence Hotel is currently generating about 0.28 per unit of risk. If you would invest 840.00 in SERENDIB HOTELS PLC on September 12, 2024 and sell it today you would earn a total of 420.00 from holding SERENDIB HOTELS PLC or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.31% |
| Values | Daily Returns |
SERENDIB HOTELS PLC vs. Aitken Spence Hotel
Performance |
| Timeline |
| SERENDIB HOTELS PLC |
| Aitken Spence Hotel |
SERENDIB HOTELS and Aitken Spence Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SERENDIB HOTELS and Aitken Spence
The main advantage of trading using opposite SERENDIB HOTELS and Aitken Spence positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SERENDIB HOTELS position performs unexpectedly, Aitken Spence 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 Aitken Spence will offset losses from the drop in Aitken Spence's long position.| SERENDIB HOTELS vs. Citrus Leisure PLC | SERENDIB HOTELS vs. Lanka Realty Investments | SERENDIB HOTELS vs. Lighthouse Hotel PLC | SERENDIB HOTELS vs. Sigiriya Village Hotels |
| Aitken Spence vs. Asian Hotels and | Aitken Spence vs. Dolphin Hotels PLC | Aitken Spence vs. Eden Hotel Lanka | Aitken Spence vs. Lion Brewery Ceylon |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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