Correlation Between Union Chemicals and Pan Asia
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By analyzing existing cross correlation between Union Chemicals Lanka and Pan Asia Banking, you can compare the effects of market volatilities on Union Chemicals and Pan Asia 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 Union Chemicals with a short position of Pan Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Union Chemicals and Pan Asia.
Diversification Opportunities for Union Chemicals and Pan Asia
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Union and Pan is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Union Chemicals Lanka and Pan Asia Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan Asia Banking and Union Chemicals 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 Union Chemicals Lanka are associated (or correlated) with Pan Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan Asia Banking has no effect on the direction of Union Chemicals i.e., Union Chemicals and Pan Asia go up and down completely randomly.
Pair Corralation between Union Chemicals and Pan Asia
Assuming the 90 days trading horizon Union Chemicals Lanka is expected to under-perform the Pan Asia. But the stock apears to be less risky and, when comparing its historical volatility, Union Chemicals Lanka is 4.41 times less risky than Pan Asia. The stock trades about -0.34 of its potential returns per unit of risk. The Pan Asia Banking is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 2,500 in Pan Asia Banking on August 31, 2024 and sell it today you would earn a total of 230.00 from holding Pan Asia Banking or generate 9.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Union Chemicals Lanka vs. Pan Asia Banking
Performance |
| Timeline |
| Union Chemicals Lanka |
| Pan Asia Banking |
Union Chemicals and Pan Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Union Chemicals and Pan Asia
The main advantage of trading using opposite Union Chemicals and Pan Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Union Chemicals position performs unexpectedly, Pan Asia 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 Pan Asia will offset losses from the drop in Pan Asia's long position.| Union Chemicals vs. HATTON NATIONAL BANK | Union Chemicals vs. Citrus Leisure PLC | Union Chemicals vs. Ceylinco Insurance PLC | Union Chemicals vs. CEYLINCO INSURANCE PLC |
| Pan Asia vs. HATTON NATIONAL BANK | Pan Asia vs. CEYLINCO INSURANCE PLC | Pan Asia vs. Seylan Bank PLC | Pan Asia vs. Commercial Credit and |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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