Correlation Between IKEJA HOTELS and AIICO INSURANCE
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By analyzing existing cross correlation between IKEJA HOTELS PLC and AIICO INSURANCE PLC, you can compare the effects of market volatilities on IKEJA HOTELS and AIICO INSURANCE 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 IKEJA HOTELS with a short position of AIICO INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of IKEJA HOTELS and AIICO INSURANCE.
Diversification Opportunities for IKEJA HOTELS and AIICO INSURANCE
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IKEJA and AIICO is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding IKEJA HOTELS PLC and AIICO INSURANCE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIICO INSURANCE PLC and IKEJA HOTELS 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 IKEJA HOTELS PLC are associated (or correlated) with AIICO INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIICO INSURANCE PLC has no effect on the direction of IKEJA HOTELS i.e., IKEJA HOTELS and AIICO INSURANCE go up and down completely randomly.
Pair Corralation between IKEJA HOTELS and AIICO INSURANCE
Assuming the 90 days trading horizon IKEJA HOTELS PLC is expected to generate 1.38 times more return on investment than AIICO INSURANCE. However, IKEJA HOTELS is 1.38 times more volatile than AIICO INSURANCE PLC. It trades about 0.13 of its potential returns per unit of risk. AIICO INSURANCE PLC is currently generating about 0.08 per unit of risk. If you would invest 100.00 in IKEJA HOTELS PLC on November 5, 2024 and sell it today you would earn a total of 1,000.00 from holding IKEJA HOTELS PLC or generate 1000.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
IKEJA HOTELS PLC vs. AIICO INSURANCE PLC
Performance |
| Timeline |
| IKEJA HOTELS PLC |
| AIICO INSURANCE PLC |
IKEJA HOTELS and AIICO INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IKEJA HOTELS and AIICO INSURANCE
The main advantage of trading using opposite IKEJA HOTELS and AIICO INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IKEJA HOTELS position performs unexpectedly, AIICO INSURANCE 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 AIICO INSURANCE will offset losses from the drop in AIICO INSURANCE's long position.| IKEJA HOTELS vs. NIGERIAN BREWERIES PLC | IKEJA HOTELS vs. C I LEASING | IKEJA HOTELS vs. GOLDEN GUINEA BREWERIES | IKEJA HOTELS vs. INTERNATIONAL BREWERIES PLC |
| AIICO INSURANCE vs. AXAMANSARD INSURANCE PLC | AIICO INSURANCE vs. GOLDEN GUINEA BREWERIES | AIICO INSURANCE vs. UNITED BANK FOR | AIICO INSURANCE vs. STACO INSURANCE 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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