Correlation Between IKEJA HOTELS and SECURE ELECTRONIC
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By analyzing existing cross correlation between IKEJA HOTELS PLC and SECURE ELECTRONIC TECHNOLOGY, you can compare the effects of market volatilities on IKEJA HOTELS and SECURE ELECTRONIC 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 SECURE ELECTRONIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of IKEJA HOTELS and SECURE ELECTRONIC.
Diversification Opportunities for IKEJA HOTELS and SECURE ELECTRONIC
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IKEJA and SECURE is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding IKEJA HOTELS PLC and SECURE ELECTRONIC TECHNOLOGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SECURE ELECTRONIC 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 SECURE ELECTRONIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SECURE ELECTRONIC has no effect on the direction of IKEJA HOTELS i.e., IKEJA HOTELS and SECURE ELECTRONIC go up and down completely randomly.
Pair Corralation between IKEJA HOTELS and SECURE ELECTRONIC
Assuming the 90 days trading horizon IKEJA HOTELS PLC is expected to under-perform the SECURE ELECTRONIC. But the stock apears to be less risky and, when comparing its historical volatility, IKEJA HOTELS PLC is 1.4 times less risky than SECURE ELECTRONIC. The stock trades about -0.12 of its potential returns per unit of risk. The SECURE ELECTRONIC TECHNOLOGY is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 75.00 in SECURE ELECTRONIC TECHNOLOGY on November 4, 2024 and sell it today you would lose (5.00) from holding SECURE ELECTRONIC TECHNOLOGY or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
IKEJA HOTELS PLC vs. SECURE ELECTRONIC TECHNOLOGY
Performance |
| Timeline |
| IKEJA HOTELS PLC |
| SECURE ELECTRONIC |
IKEJA HOTELS and SECURE ELECTRONIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IKEJA HOTELS and SECURE ELECTRONIC
The main advantage of trading using opposite IKEJA HOTELS and SECURE ELECTRONIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IKEJA HOTELS position performs unexpectedly, SECURE ELECTRONIC 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 SECURE ELECTRONIC will offset losses from the drop in SECURE ELECTRONIC's long position.| IKEJA HOTELS vs. GUINEA INSURANCE PLC | IKEJA HOTELS vs. SECURE ELECTRONIC TECHNOLOGY | IKEJA HOTELS vs. VFD GROUP | IKEJA HOTELS vs. VETIVA S P |
| SECURE ELECTRONIC vs. GUINEA INSURANCE PLC | SECURE ELECTRONIC vs. VFD GROUP | SECURE ELECTRONIC vs. IKEJA HOTELS PLC | SECURE ELECTRONIC vs. VETIVA S P |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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