Correlation Between Convenience Foods and Pegasus Hotels
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By analyzing existing cross correlation between Convenience Foods PLC and Pegasus Hotels of, you can compare the effects of market volatilities on Convenience Foods and Pegasus 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 Pegasus Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Convenience Foods and Pegasus Hotels.
Diversification Opportunities for Convenience Foods and Pegasus Hotels
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Convenience and Pegasus is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Convenience Foods PLC and Pegasus Hotels of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pegasus 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 Pegasus Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pegasus Hotels has no effect on the direction of Convenience Foods i.e., Convenience Foods and Pegasus Hotels go up and down completely randomly.
Pair Corralation between Convenience Foods and Pegasus Hotels
Assuming the 90 days trading horizon Convenience Foods PLC is expected to under-perform the Pegasus Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Convenience Foods PLC is 1.81 times less risky than Pegasus Hotels. The stock trades about -0.06 of its potential returns per unit of risk. The Pegasus Hotels of is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,660 in Pegasus Hotels of on August 31, 2024 and sell it today you would earn a total of 1,240 from holding Pegasus Hotels of or generate 46.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 80.06% |
| Values | Daily Returns |
Convenience Foods PLC vs. Pegasus Hotels of
Performance |
| Timeline |
| Convenience Foods PLC |
| Pegasus Hotels |
Convenience Foods and Pegasus Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Convenience Foods and Pegasus Hotels
The main advantage of trading using opposite Convenience Foods and Pegasus Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Convenience Foods position performs unexpectedly, Pegasus 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 Pegasus Hotels will offset losses from the drop in Pegasus Hotels' long position.| Convenience Foods vs. HNB Finance | Convenience Foods vs. Prime Lands Residencies | Convenience Foods vs. Jat Holdings PLC | Convenience Foods vs. E M L |
| Pegasus Hotels vs. Lighthouse Hotel PLC | Pegasus Hotels vs. Hatton National Bank | Pegasus Hotels vs. Amana Bank | Pegasus Hotels vs. Galadari Hotels Lanka |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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