Correlation Between NEM INSURANCE and GOLDEN GUINEA
Specify exactly 2 symbols:
By analyzing existing cross correlation between NEM INSURANCE PLC and GOLDEN GUINEA BREWERIES, you can compare the effects of market volatilities on NEM INSURANCE and GOLDEN GUINEA 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 NEM INSURANCE with a short position of GOLDEN GUINEA. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEM INSURANCE and GOLDEN GUINEA.
Diversification Opportunities for NEM INSURANCE and GOLDEN GUINEA
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NEM and GOLDEN is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding NEM INSURANCE PLC and GOLDEN GUINEA BREWERIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GOLDEN GUINEA BREWERIES and NEM 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 NEM INSURANCE PLC are associated (or correlated) with GOLDEN GUINEA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GOLDEN GUINEA BREWERIES has no effect on the direction of NEM INSURANCE i.e., NEM INSURANCE and GOLDEN GUINEA go up and down completely randomly.
Pair Corralation between NEM INSURANCE and GOLDEN GUINEA
Assuming the 90 days trading horizon NEM INSURANCE PLC is expected to generate 4.94 times more return on investment than GOLDEN GUINEA. However, NEM INSURANCE is 4.94 times more volatile than GOLDEN GUINEA BREWERIES. It trades about 0.06 of its potential returns per unit of risk. GOLDEN GUINEA BREWERIES is currently generating about 0.08 per unit of risk. If you would invest 551.00 in NEM INSURANCE PLC on September 2, 2024 and sell it today you would earn a total of 299.00 from holding NEM INSURANCE PLC or generate 54.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NEM INSURANCE PLC vs. GOLDEN GUINEA BREWERIES
Performance |
| Timeline |
| NEM INSURANCE PLC |
| GOLDEN GUINEA BREWERIES |
NEM INSURANCE and GOLDEN GUINEA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEM INSURANCE and GOLDEN GUINEA
The main advantage of trading using opposite NEM INSURANCE and GOLDEN GUINEA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEM INSURANCE position performs unexpectedly, GOLDEN GUINEA 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 GOLDEN GUINEA will offset losses from the drop in GOLDEN GUINEA's long position.The idea behind NEM INSURANCE PLC and GOLDEN GUINEA BREWERIES pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |