Correlation Between AFRICAN ALLIANCE and AFROMEDIA PLC
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By analyzing existing cross correlation between AFRICAN ALLIANCE INSURANCE and AFROMEDIA PLC, you can compare the effects of market volatilities on AFRICAN ALLIANCE and AFROMEDIA PLC 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 AFRICAN ALLIANCE with a short position of AFROMEDIA PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of AFRICAN ALLIANCE and AFROMEDIA PLC.
Diversification Opportunities for AFRICAN ALLIANCE and AFROMEDIA PLC
-1.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AFRICAN and AFROMEDIA is -1.0. Overlapping area represents the amount of risk that can be diversified away by holding AFRICAN ALLIANCE INSURANCE and AFROMEDIA PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFROMEDIA PLC and AFRICAN ALLIANCE 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 AFRICAN ALLIANCE INSURANCE are associated (or correlated) with AFROMEDIA PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFROMEDIA PLC has no effect on the direction of AFRICAN ALLIANCE i.e., AFRICAN ALLIANCE and AFROMEDIA PLC go up and down completely randomly.
Pair Corralation between AFRICAN ALLIANCE and AFROMEDIA PLC
If you would invest 20.00 in AFROMEDIA PLC on November 5, 2024 and sell it today you would earn a total of 4.00 from holding AFROMEDIA PLC or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Strong |
| Accuracy | 87.65% |
| Values | Daily Returns |
AFRICAN ALLIANCE INSURANCE vs. AFROMEDIA PLC
Performance |
| Timeline |
| AFRICAN ALLIANCE INS |
| AFROMEDIA PLC |
AFRICAN ALLIANCE and AFROMEDIA PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AFRICAN ALLIANCE and AFROMEDIA PLC
The main advantage of trading using opposite AFRICAN ALLIANCE and AFROMEDIA PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AFRICAN ALLIANCE position performs unexpectedly, AFROMEDIA PLC 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 AFROMEDIA PLC will offset losses from the drop in AFROMEDIA PLC's long position.| AFRICAN ALLIANCE vs. ECOBANK TRANSNATIONAL INCORPORATED | AFRICAN ALLIANCE vs. CUSTODIAN INVESTMENT PLC | AFRICAN ALLIANCE vs. NEM INSURANCE PLC | AFRICAN ALLIANCE vs. DN TYRE RUBBER |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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