Correlation Between CORNERSTONE INSURANCE and TOTALENERGIES MARKETING
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By analyzing existing cross correlation between CORNERSTONE INSURANCE PLC and TOTALENERGIES MARKETING NIGERIA, you can compare the effects of market volatilities on CORNERSTONE INSURANCE and TOTALENERGIES MARKETING 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 CORNERSTONE INSURANCE with a short position of TOTALENERGIES MARKETING. Check out your portfolio center. Please also check ongoing floating volatility patterns of CORNERSTONE INSURANCE and TOTALENERGIES MARKETING.
Diversification Opportunities for CORNERSTONE INSURANCE and TOTALENERGIES MARKETING
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CORNERSTONE and TOTALENERGIES is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding CORNERSTONE INSURANCE PLC and TOTALENERGIES MARKETING NIGERI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOTALENERGIES MARKETING and CORNERSTONE INSURANCE 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 CORNERSTONE INSURANCE PLC are associated (or correlated) with TOTALENERGIES MARKETING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOTALENERGIES MARKETING has no effect on the direction of CORNERSTONE INSURANCE i.e., CORNERSTONE INSURANCE and TOTALENERGIES MARKETING go up and down completely randomly.
Pair Corralation between CORNERSTONE INSURANCE and TOTALENERGIES MARKETING
Assuming the 90 days trading horizon CORNERSTONE INSURANCE PLC is expected to generate 2.41 times more return on investment than TOTALENERGIES MARKETING. However, CORNERSTONE INSURANCE is 2.41 times more volatile than TOTALENERGIES MARKETING NIGERIA. It trades about 0.08 of its potential returns per unit of risk. TOTALENERGIES MARKETING NIGERIA is currently generating about 0.15 per unit of risk. If you would invest 135.00 in CORNERSTONE INSURANCE PLC on September 2, 2024 and sell it today you would earn a total of 121.00 from holding CORNERSTONE INSURANCE PLC or generate 89.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CORNERSTONE INSURANCE PLC vs. TOTALENERGIES MARKETING NIGERI
Performance |
| Timeline |
| CORNERSTONE INSURANCE PLC |
| TOTALENERGIES MARKETING |
CORNERSTONE INSURANCE and TOTALENERGIES MARKETING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CORNERSTONE INSURANCE and TOTALENERGIES MARKETING
The main advantage of trading using opposite CORNERSTONE INSURANCE and TOTALENERGIES MARKETING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CORNERSTONE INSURANCE position performs unexpectedly, TOTALENERGIES MARKETING 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 TOTALENERGIES MARKETING will offset losses from the drop in TOTALENERGIES MARKETING's long position.The idea behind CORNERSTONE INSURANCE PLC and TOTALENERGIES MARKETING NIGERIA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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