Correlation Between Union Chemicals and Trans Asia
Specify exactly 2 symbols:
By analyzing existing cross correlation between Union Chemicals Lanka and Trans Asia Hotels, you can compare the effects of market volatilities on Union Chemicals and Trans 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 Trans Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Union Chemicals and Trans Asia.
Diversification Opportunities for Union Chemicals and Trans Asia
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Union and Trans is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Union Chemicals Lanka and Trans Asia Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trans Asia Hotels 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 Trans Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trans Asia Hotels has no effect on the direction of Union Chemicals i.e., Union Chemicals and Trans Asia go up and down completely randomly.
Pair Corralation between Union Chemicals and Trans Asia
Assuming the 90 days trading horizon Union Chemicals Lanka is expected to generate 0.77 times more return on investment than Trans Asia. However, Union Chemicals Lanka is 1.29 times less risky than Trans Asia. It trades about 0.02 of its potential returns per unit of risk. Trans Asia Hotels is currently generating about 0.01 per unit of risk. If you would invest 66,500 in Union Chemicals Lanka on August 31, 2024 and sell it today you would earn a total of 2,500 from holding Union Chemicals Lanka or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.06% |
| Values | Daily Returns |
Union Chemicals Lanka vs. Trans Asia Hotels
Performance |
| Timeline |
| Union Chemicals Lanka |
| Trans Asia Hotels |
Union Chemicals and Trans Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Union Chemicals and Trans Asia
The main advantage of trading using opposite Union Chemicals and Trans Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Union Chemicals position performs unexpectedly, Trans 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 Trans Asia will offset losses from the drop in Trans 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 |
| Trans Asia vs. Ceylon Guardian Investment | Trans Asia vs. Browns Beach Hotels | Trans Asia vs. Galadari Hotels Lanka | Trans Asia vs. Lanka Milk Foods |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |