Correlation Between Ceylon Tobacco and Singhe Hospitals
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By analyzing existing cross correlation between Ceylon Tobacco and Singhe Hospitals, you can compare the effects of market volatilities on Ceylon Tobacco and Singhe Hospitals 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 Ceylon Tobacco with a short position of Singhe Hospitals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Tobacco and Singhe Hospitals.
Diversification Opportunities for Ceylon Tobacco and Singhe Hospitals
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ceylon and Singhe is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Tobacco and Singhe Hospitals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singhe Hospitals and Ceylon Tobacco 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 Ceylon Tobacco are associated (or correlated) with Singhe Hospitals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singhe Hospitals has no effect on the direction of Ceylon Tobacco i.e., Ceylon Tobacco and Singhe Hospitals go up and down completely randomly.
Pair Corralation between Ceylon Tobacco and Singhe Hospitals
Assuming the 90 days trading horizon Ceylon Tobacco is expected to generate 0.29 times more return on investment than Singhe Hospitals. However, Ceylon Tobacco is 3.42 times less risky than Singhe Hospitals. It trades about 0.27 of its potential returns per unit of risk. Singhe Hospitals is currently generating about 0.01 per unit of risk. If you would invest 116,025 in Ceylon Tobacco on September 15, 2024 and sell it today you would earn a total of 15,975 from holding Ceylon Tobacco or generate 13.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Ceylon Tobacco vs. Singhe Hospitals
Performance |
Timeline |
Ceylon Tobacco |
Singhe Hospitals |
Ceylon Tobacco and Singhe Hospitals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ceylon Tobacco and Singhe Hospitals
The main advantage of trading using opposite Ceylon Tobacco and Singhe Hospitals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Tobacco position performs unexpectedly, Singhe Hospitals 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 Singhe Hospitals will offset losses from the drop in Singhe Hospitals' long position.Ceylon Tobacco vs. Keells Food Products | Ceylon Tobacco vs. John Keells Hotels | Ceylon Tobacco vs. Browns Beach Hotels | Ceylon Tobacco vs. Palm Garden Hotels |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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