Correlation Between Ceylinco Insurance and Sri Lanka
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By analyzing existing cross correlation between Ceylinco Insurance PLC and Sri Lanka Telecom, you can compare the effects of market volatilities on Ceylinco Insurance 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 Ceylinco Insurance with a short position of Sri Lanka. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylinco Insurance and Sri Lanka.
Diversification Opportunities for Ceylinco Insurance and Sri Lanka
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ceylinco and Sri is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ceylinco Insurance PLC 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 Ceylinco Insurance 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 Ceylinco Insurance PLC 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 Ceylinco Insurance i.e., Ceylinco Insurance and Sri Lanka go up and down completely randomly.
Pair Corralation between Ceylinco Insurance and Sri Lanka
Assuming the 90 days trading horizon Ceylinco Insurance PLC is expected to generate 1.44 times more return on investment than Sri Lanka. However, Ceylinco Insurance is 1.44 times more volatile than Sri Lanka Telecom. It trades about 0.27 of its potential returns per unit of risk. Sri Lanka Telecom is currently generating about 0.05 per unit of risk. If you would invest 222,025 in Ceylinco Insurance PLC on September 25, 2024 and sell it today you would earn a total of 77,975 from holding Ceylinco Insurance PLC or generate 35.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 62.3% |
Values | Daily Returns |
Ceylinco Insurance PLC vs. Sri Lanka Telecom
Performance |
Timeline |
Ceylinco Insurance PLC |
Sri Lanka Telecom |
Ceylinco Insurance and Sri Lanka Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ceylinco Insurance and Sri Lanka
The main advantage of trading using opposite Ceylinco Insurance and Sri Lanka positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylinco Insurance 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.Ceylinco Insurance vs. HNB Finance | Ceylinco Insurance vs. Prime Lands Residencies | Ceylinco Insurance vs. Jat Holdings PLC | Ceylinco Insurance vs. Lanka Credit and |
Sri Lanka vs. HNB Finance | Sri Lanka vs. Prime Lands Residencies | Sri Lanka vs. Jat Holdings PLC | Sri Lanka vs. Lanka 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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