Correlation Between Convenience Foods and Ceylon Hotels
Specify exactly 2 symbols:
By analyzing existing cross correlation between Convenience Foods PLC and Ceylon Hotels, you can compare the effects of market volatilities on Convenience Foods and Ceylon Hotels 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 Convenience Foods with a short position of Ceylon Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Convenience Foods and Ceylon Hotels.
Diversification Opportunities for Convenience Foods and Ceylon Hotels
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Convenience and Ceylon is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Convenience Foods PLC and Ceylon Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ceylon Hotels and Convenience Foods 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 Convenience Foods PLC are associated (or correlated) with Ceylon Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ceylon Hotels has no effect on the direction of Convenience Foods i.e., Convenience Foods and Ceylon Hotels go up and down completely randomly.
Pair Corralation between Convenience Foods and Ceylon Hotels
Assuming the 90 days trading horizon Convenience Foods PLC is expected to under-perform the Ceylon Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Convenience Foods PLC is 1.2 times less risky than Ceylon Hotels. The stock trades about -0.06 of its potential returns per unit of risk. The Ceylon Hotels is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,910 in Ceylon Hotels on August 27, 2024 and sell it today you would earn a total of 110.00 from holding Ceylon Hotels or generate 5.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 75.5% |
| Values | Daily Returns |
Convenience Foods PLC vs. Ceylon Hotels
Performance |
| Timeline |
| Convenience Foods PLC |
| Ceylon Hotels |
Convenience Foods and Ceylon Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Convenience Foods and Ceylon Hotels
The main advantage of trading using opposite Convenience Foods and Ceylon Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Convenience Foods position performs unexpectedly, Ceylon Hotels 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 Ceylon Hotels will offset losses from the drop in Ceylon Hotels' long position.| Convenience Foods vs. Union Chemicals Lanka | Convenience Foods vs. Union Bank | Convenience Foods vs. Janashakthi Insurance | Convenience Foods vs. Seylan Bank PLC |
| Ceylon Hotels vs. Nuwara Eliya Hotels | Ceylon Hotels vs. Tal Lanka Hotels | Ceylon Hotels vs. Renuka Agri Foods | Ceylon Hotels vs. Aitken Spence 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |