Correlation Between ABBEY MORTGAGE and NEM INSURANCE
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By analyzing existing cross correlation between ABBEY MORTGAGE BANK and NEM INSURANCE PLC, you can compare the effects of market volatilities on ABBEY MORTGAGE and NEM INSURANCE 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 ABBEY MORTGAGE with a short position of NEM INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABBEY MORTGAGE and NEM INSURANCE.
Diversification Opportunities for ABBEY MORTGAGE and NEM INSURANCE
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ABBEY and NEM is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding ABBEY MORTGAGE BANK and NEM INSURANCE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEM INSURANCE PLC and ABBEY MORTGAGE 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 ABBEY MORTGAGE BANK are associated (or correlated) with NEM INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEM INSURANCE PLC has no effect on the direction of ABBEY MORTGAGE i.e., ABBEY MORTGAGE and NEM INSURANCE go up and down completely randomly.
Pair Corralation between ABBEY MORTGAGE and NEM INSURANCE
Assuming the 90 days trading horizon ABBEY MORTGAGE is expected to generate 1.74 times less return on investment than NEM INSURANCE. But when comparing it to its historical volatility, ABBEY MORTGAGE BANK is 1.45 times less risky than NEM INSURANCE. It trades about 0.3 of its potential returns per unit of risk. NEM INSURANCE PLC is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 805.00 in NEM INSURANCE PLC on September 19, 2024 and sell it today you would earn a total of 245.00 from holding NEM INSURANCE PLC or generate 30.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABBEY MORTGAGE BANK vs. NEM INSURANCE PLC
Performance |
| Timeline |
| ABBEY MORTGAGE BANK |
| NEM INSURANCE PLC |
ABBEY MORTGAGE and NEM INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABBEY MORTGAGE and NEM INSURANCE
The main advantage of trading using opposite ABBEY MORTGAGE and NEM INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABBEY MORTGAGE position performs unexpectedly, NEM INSURANCE 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 NEM INSURANCE will offset losses from the drop in NEM INSURANCE's long position.| ABBEY MORTGAGE vs. GUINEA INSURANCE PLC | ABBEY MORTGAGE vs. SECURE ELECTRONIC TECHNOLOGY | ABBEY MORTGAGE vs. VFD GROUP | ABBEY MORTGAGE vs. IKEJA HOTELS PLC |
| NEM INSURANCE vs. GUINEA INSURANCE PLC | NEM INSURANCE vs. SECURE ELECTRONIC TECHNOLOGY | NEM INSURANCE vs. VFD GROUP | NEM INSURANCE vs. IKEJA HOTELS PLC |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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