Correlation Between Nigerian Stock and NEWGOLD EXCHANGE
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By analyzing existing cross correlation between Nigerian Stock Exchange and NEWGOLD EXCHANGE TRADED, you can compare the effects of market volatilities on Nigerian Stock and NEWGOLD EXCHANGE 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 NEWGOLD EXCHANGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nigerian Stock and NEWGOLD EXCHANGE.
Diversification Opportunities for Nigerian Stock and NEWGOLD EXCHANGE
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nigerian and NEWGOLD is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Nigerian Stock Exchange and NEWGOLD EXCHANGE TRADED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEWGOLD EXCHANGE TRADED 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 NEWGOLD EXCHANGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEWGOLD EXCHANGE TRADED has no effect on the direction of Nigerian Stock i.e., Nigerian Stock and NEWGOLD EXCHANGE go up and down completely randomly.
Pair Corralation between Nigerian Stock and NEWGOLD EXCHANGE
Assuming the 90 days trading horizon Nigerian Stock is expected to generate 4.99 times less return on investment than NEWGOLD EXCHANGE. But when comparing it to its historical volatility, Nigerian Stock Exchange is 40.67 times less risky than NEWGOLD EXCHANGE. It trades about 0.43 of its potential returns per unit of risk. NEWGOLD EXCHANGE TRADED is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,000,000 in NEWGOLD EXCHANGE TRADED on September 19, 2024 and sell it today you would earn a total of 0.00 from holding NEWGOLD EXCHANGE TRADED or generate 0.0% 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. NEWGOLD EXCHANGE TRADED
Performance |
| Timeline |
Nigerian Stock and NEWGOLD EXCHANGE Volatility Contrast
Predicted Return Density |
| Returns |
Nigerian Stock Exchange
Pair trading matchups for Nigerian Stock
NEWGOLD EXCHANGE TRADED
Pair trading matchups for NEWGOLD EXCHANGE
Pair Trading with Nigerian Stock and NEWGOLD EXCHANGE
The main advantage of trading using opposite Nigerian Stock and NEWGOLD EXCHANGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nigerian Stock position performs unexpectedly, NEWGOLD EXCHANGE 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 NEWGOLD EXCHANGE will offset losses from the drop in NEWGOLD EXCHANGE's long position.| Nigerian Stock vs. UNITED BANK FOR | Nigerian Stock vs. TOTALENERGIES MARKETING NIGERIA | Nigerian Stock vs. WEMA BANK PLC | Nigerian Stock vs. ECOBANK TRANSNATIONAL INCORPORATED |
| NEWGOLD EXCHANGE vs. GUINEA INSURANCE PLC | NEWGOLD EXCHANGE vs. SECURE ELECTRONIC TECHNOLOGY | NEWGOLD EXCHANGE vs. VFD GROUP | NEWGOLD EXCHANGE 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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