Correlation Between Tal Lanka and Sri Lanka
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By analyzing existing cross correlation between Tal Lanka Hotels and Sri Lanka Telecom, you can compare the effects of market volatilities on Tal Lanka and Sri Lanka 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 Tal Lanka with a short position of Sri Lanka. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tal Lanka and Sri Lanka.
Diversification Opportunities for Tal Lanka and Sri Lanka
Weak diversification
The 3 months correlation between Tal and Sri is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Tal Lanka Hotels and Sri Lanka Telecom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sri Lanka Telecom and Tal Lanka 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 Tal Lanka Hotels are associated (or correlated) with Sri Lanka. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sri Lanka Telecom has no effect on the direction of Tal Lanka i.e., Tal Lanka and Sri Lanka go up and down completely randomly.
Pair Corralation between Tal Lanka and Sri Lanka
Assuming the 90 days trading horizon Tal Lanka Hotels is expected to generate 2.27 times more return on investment than Sri Lanka. However, Tal Lanka is 2.27 times more volatile than Sri Lanka Telecom. It trades about 0.23 of its potential returns per unit of risk. Sri Lanka Telecom is currently generating about -0.03 per unit of risk. If you would invest 1,830 in Tal Lanka Hotels on September 15, 2024 and sell it today you would earn a total of 270.00 from holding Tal Lanka Hotels or generate 14.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tal Lanka Hotels vs. Sri Lanka Telecom
Performance |
| Timeline |
| Tal Lanka Hotels |
| Sri Lanka Telecom |
Tal Lanka and Sri Lanka Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tal Lanka and Sri Lanka
The main advantage of trading using opposite Tal Lanka and Sri Lanka positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tal Lanka position performs unexpectedly, Sri Lanka 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 Sri Lanka will offset losses from the drop in Sri Lanka's long position.| Tal Lanka vs. Lanka Realty Investments | Tal Lanka vs. SERENDIB HOTELS PLC | Tal Lanka vs. Pegasus Hotels of | Tal Lanka vs. Browns Beach Hotels |
| Sri Lanka vs. PEOPLES LEASING FINANCE | Sri Lanka vs. Convenience Foods PLC | Sri Lanka vs. Keells Food Products | Sri Lanka vs. Ceylon Tobacco |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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