Correlation Between CO OPERATIVE and NATION MEDIA
Can any of the company-specific risk be diversified away by investing in both CO OPERATIVE and NATION MEDIA at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CO OPERATIVE and NATION MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CO OPERATIVE BANK OF and NATION MEDIA GROUP, you can compare the effects of market volatilities on CO OPERATIVE and NATION MEDIA 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 CO OPERATIVE with a short position of NATION MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CO OPERATIVE and NATION MEDIA.
Diversification Opportunities for CO OPERATIVE and NATION MEDIA
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CBKL and NATION is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding CO OPERATIVE BANK OF and NATION MEDIA GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATION MEDIA GROUP and CO OPERATIVE 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 CO OPERATIVE BANK OF are associated (or correlated) with NATION MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATION MEDIA GROUP has no effect on the direction of CO OPERATIVE i.e., CO OPERATIVE and NATION MEDIA go up and down completely randomly.
Pair Corralation between CO OPERATIVE and NATION MEDIA
Assuming the 90 days trading horizon CO OPERATIVE BANK OF is expected to generate 0.59 times more return on investment than NATION MEDIA. However, CO OPERATIVE BANK OF is 1.69 times less risky than NATION MEDIA. It trades about 0.03 of its potential returns per unit of risk. NATION MEDIA GROUP is currently generating about -0.01 per unit of risk. If you would invest 1,210 in CO OPERATIVE BANK OF on September 3, 2024 and sell it today you would earn a total of 170.00 from holding CO OPERATIVE BANK OF or generate 14.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CO OPERATIVE BANK OF vs. NATION MEDIA GROUP
Performance |
| Timeline |
| CO OPERATIVE BANK |
| NATION MEDIA GROUP |
CO OPERATIVE and NATION MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CO OPERATIVE and NATION MEDIA
The main advantage of trading using opposite CO OPERATIVE and NATION MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CO OPERATIVE position performs unexpectedly, NATION MEDIA 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 NATION MEDIA will offset losses from the drop in NATION MEDIA's long position.| CO OPERATIVE vs. KENYA ORCHARDS LTD | CO OPERATIVE vs. NAIROBI BUSINESS VENTURES | CO OPERATIVE vs. KENYA RE INSURANCE PORATION | CO OPERATIVE vs. WPP SCANGROUP PLC |
| NATION MEDIA vs. CENTUM INVESTMENT PANY | NATION MEDIA vs. ABSA BANK OF | NATION MEDIA vs. HOME AFRIKA LTD | NATION MEDIA vs. HOMEBOYZ ENTERTAINMENT 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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