Correlation Between NICO HOLDINGS and STANDARD BANK
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By analyzing existing cross correlation between NICO HOLDINGS LIMITED and STANDARD BANK LIMITED, you can compare the effects of market volatilities on NICO HOLDINGS and STANDARD BANK 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 NICO HOLDINGS with a short position of STANDARD BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of NICO HOLDINGS and STANDARD BANK.
Diversification Opportunities for NICO HOLDINGS and STANDARD BANK
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NICO and STANDARD is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding NICO HOLDINGS LIMITED and STANDARD BANK LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STANDARD BANK LIMITED and NICO HOLDINGS 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 NICO HOLDINGS LIMITED are associated (or correlated) with STANDARD BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STANDARD BANK LIMITED has no effect on the direction of NICO HOLDINGS i.e., NICO HOLDINGS and STANDARD BANK go up and down completely randomly.
Pair Corralation between NICO HOLDINGS and STANDARD BANK
Assuming the 90 days trading horizon NICO HOLDINGS LIMITED is expected to generate 1.46 times more return on investment than STANDARD BANK. However, NICO HOLDINGS is 1.46 times more volatile than STANDARD BANK LIMITED. It trades about 0.18 of its potential returns per unit of risk. STANDARD BANK LIMITED is currently generating about 0.17 per unit of risk. If you would invest 7,500 in NICO HOLDINGS LIMITED on November 2, 2024 and sell it today you would earn a total of 34,402 from holding NICO HOLDINGS LIMITED or generate 458.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
NICO HOLDINGS LIMITED vs. STANDARD BANK LIMITED
Performance |
| Timeline |
| NICO HOLDINGS LIMITED |
| STANDARD BANK LIMITED |
NICO HOLDINGS and STANDARD BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NICO HOLDINGS and STANDARD BANK
The main advantage of trading using opposite NICO HOLDINGS and STANDARD BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NICO HOLDINGS position performs unexpectedly, STANDARD BANK 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 STANDARD BANK will offset losses from the drop in STANDARD BANK's long position.| NICO HOLDINGS vs. MALAWI PROPERTY INVESTMENT | NICO HOLDINGS vs. STANDARD BANK LIMITED | NICO HOLDINGS vs. NATIONAL INVESTMENT TRUST | NICO HOLDINGS vs. FDH BANK 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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