Correlation Between CRDB BANK and AFRIPRISE INVESTMENT
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By analyzing existing cross correlation between CRDB BANK LTD and AFRIPRISE INVESTMENT PLC, you can compare the effects of market volatilities on CRDB BANK and AFRIPRISE INVESTMENT 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 CRDB BANK with a short position of AFRIPRISE INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of CRDB BANK and AFRIPRISE INVESTMENT.
Diversification Opportunities for CRDB BANK and AFRIPRISE INVESTMENT
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CRDB and AFRIPRISE is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding CRDB BANK LTD and AFRIPRISE INVESTMENT PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFRIPRISE INVESTMENT PLC and CRDB BANK 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 CRDB BANK LTD are associated (or correlated) with AFRIPRISE INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFRIPRISE INVESTMENT PLC has no effect on the direction of CRDB BANK i.e., CRDB BANK and AFRIPRISE INVESTMENT go up and down completely randomly.
Pair Corralation between CRDB BANK and AFRIPRISE INVESTMENT
Assuming the 90 days trading horizon CRDB BANK LTD is expected to under-perform the AFRIPRISE INVESTMENT. But the stock apears to be less risky and, when comparing its historical volatility, CRDB BANK LTD is 2.06 times less risky than AFRIPRISE INVESTMENT. The stock trades about -0.05 of its potential returns per unit of risk. The AFRIPRISE INVESTMENT PLC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 23,000 in AFRIPRISE INVESTMENT PLC on September 2, 2024 and sell it today you would earn a total of 500.00 from holding AFRIPRISE INVESTMENT PLC or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CRDB BANK LTD vs. AFRIPRISE INVESTMENT PLC
Performance |
| Timeline |
| CRDB BANK LTD |
| AFRIPRISE INVESTMENT PLC |
CRDB BANK and AFRIPRISE INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CRDB BANK and AFRIPRISE INVESTMENT
The main advantage of trading using opposite CRDB BANK and AFRIPRISE INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CRDB BANK position performs unexpectedly, AFRIPRISE INVESTMENT 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 AFRIPRISE INVESTMENT will offset losses from the drop in AFRIPRISE INVESTMENT's long position.The idea behind CRDB BANK LTD and AFRIPRISE INVESTMENT PLC 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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