Correlation Between NIGERIAN BREWERIES and TRANSCORP HOTELS
Specify exactly 2 symbols:
By analyzing existing cross correlation between NIGERIAN BREWERIES PLC and TRANSCORP HOTELS PLC, you can compare the effects of market volatilities on NIGERIAN BREWERIES 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 NIGERIAN BREWERIES with a short position of TRANSCORP HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of NIGERIAN BREWERIES and TRANSCORP HOTELS.
Diversification Opportunities for NIGERIAN BREWERIES and TRANSCORP HOTELS
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NIGERIAN and TRANSCORP is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding NIGERIAN BREWERIES 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 NIGERIAN BREWERIES 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 NIGERIAN BREWERIES 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 NIGERIAN BREWERIES i.e., NIGERIAN BREWERIES and TRANSCORP HOTELS go up and down completely randomly.
Pair Corralation between NIGERIAN BREWERIES and TRANSCORP HOTELS
Assuming the 90 days trading horizon NIGERIAN BREWERIES PLC is expected to under-perform the TRANSCORP HOTELS. But the stock apears to be less risky and, when comparing its historical volatility, NIGERIAN BREWERIES PLC is 1.1 times less risky than TRANSCORP HOTELS. The stock trades about -0.04 of its potential returns per unit of risk. The TRANSCORP HOTELS PLC is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,460 in TRANSCORP HOTELS PLC on September 12, 2024 and sell it today you would earn a total of 9,140 from holding TRANSCORP HOTELS PLC or generate 626.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NIGERIAN BREWERIES PLC vs. TRANSCORP HOTELS PLC
Performance |
| Timeline |
| NIGERIAN BREWERIES PLC |
| TRANSCORP HOTELS PLC |
NIGERIAN BREWERIES and TRANSCORP HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NIGERIAN BREWERIES and TRANSCORP HOTELS
The main advantage of trading using opposite NIGERIAN BREWERIES and TRANSCORP HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NIGERIAN BREWERIES 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.| NIGERIAN BREWERIES vs. GUINEA INSURANCE PLC | NIGERIAN BREWERIES vs. SECURE ELECTRONIC TECHNOLOGY | NIGERIAN BREWERIES vs. VFD GROUP | NIGERIAN BREWERIES vs. IKEJA HOTELS PLC |
| TRANSCORP HOTELS vs. GUINEA INSURANCE PLC | TRANSCORP HOTELS vs. SECURE ELECTRONIC TECHNOLOGY | TRANSCORP HOTELS vs. VFD GROUP | TRANSCORP HOTELS vs. IKEJA HOTELS 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |