Correlation Between FDH BANK and STANDARD BANK
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By analyzing existing cross correlation between FDH BANK PLC and STANDARD BANK LIMITED, you can compare the effects of market volatilities on FDH BANK and STANDARD BANK 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 FDH BANK with a short position of STANDARD BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of FDH BANK and STANDARD BANK.
Diversification Opportunities for FDH BANK and STANDARD BANK
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FDH and STANDARD is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding FDH BANK PLC and STANDARD BANK LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STANDARD BANK LIMITED and FDH 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 FDH BANK PLC are associated (or correlated) with STANDARD BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STANDARD BANK LIMITED has no effect on the direction of FDH BANK i.e., FDH BANK and STANDARD BANK go up and down completely randomly.
Pair Corralation between FDH BANK and STANDARD BANK
Assuming the 90 days trading horizon FDH BANK PLC is expected to under-perform the STANDARD BANK. But the stock apears to be less risky and, when comparing its historical volatility, FDH BANK PLC is 15.81 times less risky than STANDARD BANK. The stock trades about -0.13 of its potential returns per unit of risk. The STANDARD BANK LIMITED is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 549,512 in STANDARD BANK LIMITED on August 30, 2024 and sell it today you would earn a total of 50,497 from holding STANDARD BANK LIMITED or generate 9.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
FDH BANK PLC vs. STANDARD BANK LIMITED
Performance |
| Timeline |
| FDH BANK PLC |
| STANDARD BANK LIMITED |
FDH BANK and STANDARD BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FDH BANK and STANDARD BANK
The main advantage of trading using opposite FDH BANK and STANDARD BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FDH BANK position performs unexpectedly, STANDARD BANK 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 STANDARD BANK will offset losses from the drop in STANDARD BANK's long position.| FDH BANK vs. NBS BANK LIMITED | FDH BANK vs. MALAWI PROPERTY INVESTMENT | FDH BANK vs. NICO HOLDINGS LIMITED | FDH BANK vs. BLANTYRE HOTELS LIMITED |
| STANDARD BANK vs. NBS BANK LIMITED | STANDARD BANK vs. MALAWI PROPERTY INVESTMENT | STANDARD BANK vs. NICO HOLDINGS LIMITED | STANDARD BANK vs. BLANTYRE HOTELS LIMITED |
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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