Correlation Between BUA FOODS and NIGERIAN EXCHANGE
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By analyzing existing cross correlation between BUA FOODS PLC and NIGERIAN EXCHANGE GROUP, you can compare the effects of market volatilities on BUA FOODS and NIGERIAN EXCHANGE 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 BUA FOODS with a short position of NIGERIAN EXCHANGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of BUA FOODS and NIGERIAN EXCHANGE.
Diversification Opportunities for BUA FOODS and NIGERIAN EXCHANGE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BUA and NIGERIAN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BUA FOODS PLC and NIGERIAN EXCHANGE GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NIGERIAN EXCHANGE and BUA FOODS 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 BUA FOODS PLC are associated (or correlated) with NIGERIAN EXCHANGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NIGERIAN EXCHANGE has no effect on the direction of BUA FOODS i.e., BUA FOODS and NIGERIAN EXCHANGE go up and down completely randomly.
Pair Corralation between BUA FOODS and NIGERIAN EXCHANGE
Assuming the 90 days trading horizon BUA FOODS PLC is expected to generate 0.43 times more return on investment than NIGERIAN EXCHANGE. However, BUA FOODS PLC is 2.31 times less risky than NIGERIAN EXCHANGE. It trades about 0.22 of its potential returns per unit of risk. NIGERIAN EXCHANGE GROUP is currently generating about 0.05 per unit of risk. If you would invest 19,890 in BUA FOODS PLC on September 12, 2024 and sell it today you would earn a total of 19,600 from holding BUA FOODS PLC or generate 98.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BUA FOODS PLC vs. NIGERIAN EXCHANGE GROUP
Performance |
| Timeline |
| BUA FOODS PLC |
| NIGERIAN EXCHANGE |
BUA FOODS and NIGERIAN EXCHANGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BUA FOODS and NIGERIAN EXCHANGE
The main advantage of trading using opposite BUA FOODS and NIGERIAN EXCHANGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BUA FOODS position performs unexpectedly, NIGERIAN EXCHANGE 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 NIGERIAN EXCHANGE will offset losses from the drop in NIGERIAN EXCHANGE's long position.| BUA FOODS vs. GUINEA INSURANCE PLC | BUA FOODS vs. SECURE ELECTRONIC TECHNOLOGY | BUA FOODS vs. VFD GROUP | BUA FOODS vs. IKEJA HOTELS PLC |
| NIGERIAN EXCHANGE vs. AFROMEDIA PLC | NIGERIAN EXCHANGE vs. GUINEA INSURANCE PLC | NIGERIAN EXCHANGE vs. GOLDEN GUINEA BREWERIES | NIGERIAN EXCHANGE vs. INTERNATIONAL BREWERIES 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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