Correlation Between GUINEA INSURANCE and TRANSCORP HOTELS
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By analyzing existing cross correlation between GUINEA INSURANCE PLC and TRANSCORP HOTELS PLC, you can compare the effects of market volatilities on GUINEA INSURANCE and TRANSCORP HOTELS 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 GUINEA INSURANCE with a short position of TRANSCORP HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GUINEA INSURANCE and TRANSCORP HOTELS.
Diversification Opportunities for GUINEA INSURANCE and TRANSCORP HOTELS
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GUINEA and TRANSCORP is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding GUINEA INSURANCE PLC and TRANSCORP HOTELS PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRANSCORP HOTELS PLC and GUINEA 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 GUINEA INSURANCE PLC are associated (or correlated) with TRANSCORP HOTELS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRANSCORP HOTELS PLC has no effect on the direction of GUINEA INSURANCE i.e., GUINEA INSURANCE and TRANSCORP HOTELS go up and down completely randomly.
Pair Corralation between GUINEA INSURANCE and TRANSCORP HOTELS
Assuming the 90 days trading horizon GUINEA INSURANCE is expected to generate 1.46 times less return on investment than TRANSCORP HOTELS. In addition to that, GUINEA INSURANCE is 1.74 times more volatile than TRANSCORP HOTELS PLC. It trades about 0.09 of its total potential returns per unit of risk. TRANSCORP HOTELS PLC is currently generating about 0.23 per unit of volatility. If you would invest 605.00 in TRANSCORP HOTELS PLC on October 25, 2024 and sell it today you would earn a total of 12,130 from holding TRANSCORP HOTELS PLC or generate 2004.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.99% |
| Values | Daily Returns |
GUINEA INSURANCE PLC vs. TRANSCORP HOTELS PLC
Performance |
| Timeline |
| GUINEA INSURANCE PLC |
| TRANSCORP HOTELS PLC |
GUINEA INSURANCE and TRANSCORP HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GUINEA INSURANCE and TRANSCORP HOTELS
The main advantage of trading using opposite GUINEA INSURANCE and TRANSCORP HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GUINEA INSURANCE position performs unexpectedly, TRANSCORP HOTELS 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 TRANSCORP HOTELS will offset losses from the drop in TRANSCORP HOTELS's long position.| GUINEA INSURANCE vs. TRANSCORP HOTELS PLC | GUINEA INSURANCE vs. ZENITH BANK PLC | GUINEA INSURANCE vs. VETIVA BANKING ETF | GUINEA INSURANCE vs. INDUSTRIAL MEDICAL GASES |
| TRANSCORP HOTELS vs. UNION HOMES REAL | TRANSCORP HOTELS vs. FIDSON HEALTHCARE PLC | TRANSCORP HOTELS vs. DN TYRE RUBBER | TRANSCORP HOTELS vs. INTERNATIONAL BREWERIES 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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