Correlation Between Nigerian Stock and LIVINGTRUST MORTGAGE
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By analyzing existing cross correlation between Nigerian Stock Exchange and LIVINGTRUST MORTGAGE BANK, you can compare the effects of market volatilities on Nigerian Stock and LIVINGTRUST MORTGAGE 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 Stock with a short position of LIVINGTRUST MORTGAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nigerian Stock and LIVINGTRUST MORTGAGE.
Diversification Opportunities for Nigerian Stock and LIVINGTRUST MORTGAGE
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nigerian and LIVINGTRUST is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Nigerian Stock Exchange and LIVINGTRUST MORTGAGE BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LIVINGTRUST MORTGAGE BANK and Nigerian Stock 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 Stock Exchange are associated (or correlated) with LIVINGTRUST MORTGAGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LIVINGTRUST MORTGAGE BANK has no effect on the direction of Nigerian Stock i.e., Nigerian Stock and LIVINGTRUST MORTGAGE go up and down completely randomly.
Pair Corralation between Nigerian Stock and LIVINGTRUST MORTGAGE
Assuming the 90 days trading horizon Nigerian Stock is expected to generate 3.95 times less return on investment than LIVINGTRUST MORTGAGE. But when comparing it to its historical volatility, Nigerian Stock Exchange is 7.43 times less risky than LIVINGTRUST MORTGAGE. It trades about 0.4 of its potential returns per unit of risk. LIVINGTRUST MORTGAGE BANK is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 300.00 in LIVINGTRUST MORTGAGE BANK on September 20, 2024 and sell it today you would earn a total of 30.00 from holding LIVINGTRUST MORTGAGE BANK or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nigerian Stock Exchange vs. LIVINGTRUST MORTGAGE BANK
Performance |
| Timeline |
Nigerian Stock and LIVINGTRUST MORTGAGE Volatility Contrast
Predicted Return Density |
| Returns |
Nigerian Stock Exchange
Pair trading matchups for Nigerian Stock
LIVINGTRUST MORTGAGE BANK
Pair trading matchups for LIVINGTRUST MORTGAGE
Pair Trading with Nigerian Stock and LIVINGTRUST MORTGAGE
The main advantage of trading using opposite Nigerian Stock and LIVINGTRUST MORTGAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nigerian Stock position performs unexpectedly, LIVINGTRUST MORTGAGE 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 LIVINGTRUST MORTGAGE will offset losses from the drop in LIVINGTRUST MORTGAGE's long position.| Nigerian Stock vs. NOTORE CHEMICAL IND | Nigerian Stock vs. ECOBANK TRANSNATIONAL INCORPORATED | Nigerian Stock vs. SECURE ELECTRONIC TECHNOLOGY | Nigerian Stock vs. AIICO INSURANCE PLC |
| LIVINGTRUST MORTGAGE vs. GUINEA INSURANCE PLC | LIVINGTRUST MORTGAGE vs. SECURE ELECTRONIC TECHNOLOGY | LIVINGTRUST MORTGAGE vs. VFD GROUP | LIVINGTRUST MORTGAGE 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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