Correlation Between GOLDEN GUINEA and NIGERIAN EXCHANGE
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By analyzing existing cross correlation between GOLDEN GUINEA BREWERIES and NIGERIAN EXCHANGE GROUP, you can compare the effects of market volatilities on GOLDEN GUINEA 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 GOLDEN GUINEA with a short position of NIGERIAN EXCHANGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLDEN GUINEA and NIGERIAN EXCHANGE.
Diversification Opportunities for GOLDEN GUINEA and NIGERIAN EXCHANGE
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GOLDEN and NIGERIAN is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding GOLDEN GUINEA BREWERIES and NIGERIAN EXCHANGE GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NIGERIAN EXCHANGE and GOLDEN GUINEA 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 GOLDEN GUINEA BREWERIES 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 GOLDEN GUINEA i.e., GOLDEN GUINEA and NIGERIAN EXCHANGE go up and down completely randomly.
Pair Corralation between GOLDEN GUINEA and NIGERIAN EXCHANGE
Assuming the 90 days trading horizon GOLDEN GUINEA BREWERIES is expected to generate 1.04 times more return on investment than NIGERIAN EXCHANGE. However, GOLDEN GUINEA is 1.04 times more volatile than NIGERIAN EXCHANGE GROUP. It trades about 0.37 of its potential returns per unit of risk. NIGERIAN EXCHANGE GROUP is currently generating about 0.14 per unit of risk. If you would invest 315.00 in GOLDEN GUINEA BREWERIES on September 12, 2024 and sell it today you would earn a total of 338.00 from holding GOLDEN GUINEA BREWERIES or generate 107.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GOLDEN GUINEA BREWERIES vs. NIGERIAN EXCHANGE GROUP
Performance |
| Timeline |
| GOLDEN GUINEA BREWERIES |
| NIGERIAN EXCHANGE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
GOLDEN GUINEA and NIGERIAN EXCHANGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GOLDEN GUINEA and NIGERIAN EXCHANGE
The main advantage of trading using opposite GOLDEN GUINEA and NIGERIAN EXCHANGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLDEN GUINEA 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.| GOLDEN GUINEA vs. MULTIVERSE MINING AND | GOLDEN GUINEA vs. VETIVA BANKING ETF | GOLDEN GUINEA vs. UNITED BANK FOR | GOLDEN GUINEA vs. MULTI TREX INTEGRATED FOODS |
| NIGERIAN EXCHANGE vs. CONSOLIDATED HALLMARK INSURANCE | NIGERIAN EXCHANGE vs. CORNERSTONE INSURANCE PLC | NIGERIAN EXCHANGE vs. FIDELITY BANK PLC | NIGERIAN EXCHANGE vs. SOVEREIGN TRUST INSURANCE |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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