Correlation Between MCNICHOLS NIGERIA and Dow Jones
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By analyzing existing cross correlation between MCNICHOLS NIGERIA PLC and Dow Jones Industrial, you can compare the effects of market volatilities on MCNICHOLS NIGERIA and Dow Jones 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 MCNICHOLS NIGERIA with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCNICHOLS NIGERIA and Dow Jones.
Diversification Opportunities for MCNICHOLS NIGERIA and Dow Jones
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between MCNICHOLS and Dow is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding MCNICHOLS NIGERIA PLC and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and MCNICHOLS NIGERIA 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 MCNICHOLS NIGERIA PLC are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of MCNICHOLS NIGERIA i.e., MCNICHOLS NIGERIA and Dow Jones go up and down completely randomly.
Pair Corralation between MCNICHOLS NIGERIA and Dow Jones
Assuming the 90 days trading horizon MCNICHOLS NIGERIA PLC is expected to generate 6.67 times more return on investment than Dow Jones. However, MCNICHOLS NIGERIA is 6.67 times more volatile than Dow Jones Industrial. It trades about 0.09 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.13 per unit of risk. If you would invest 69.00 in MCNICHOLS NIGERIA PLC on September 3, 2024 and sell it today you would earn a total of 71.00 from holding MCNICHOLS NIGERIA PLC or generate 102.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.38% |
| Values | Daily Returns |
MCNICHOLS NIGERIA PLC vs. Dow Jones Industrial
Performance |
| Timeline |
MCNICHOLS NIGERIA and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
MCNICHOLS NIGERIA PLC
Pair trading matchups for MCNICHOLS NIGERIA
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with MCNICHOLS NIGERIA and Dow Jones
The main advantage of trading using opposite MCNICHOLS NIGERIA and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCNICHOLS NIGERIA position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| MCNICHOLS NIGERIA vs. AXAMANSARD INSURANCE PLC | MCNICHOLS NIGERIA vs. IKEJA HOTELS PLC | MCNICHOLS NIGERIA vs. ASO SAVINGS AND | MCNICHOLS NIGERIA vs. CORNERSTONE INSURANCE PLC |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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