Correlation Between UCHUMI SUPERMARKET and DCB MERCIAL
Can any of the company-specific risk be diversified away by investing in both UCHUMI SUPERMARKET and DCB MERCIAL at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining UCHUMI SUPERMARKET and DCB MERCIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UCHUMI SUPERMARKET LTD and DCB MERCIAL BANK, you can compare the effects of market volatilities on UCHUMI SUPERMARKET and DCB MERCIAL 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 UCHUMI SUPERMARKET with a short position of DCB MERCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of UCHUMI SUPERMARKET and DCB MERCIAL.
Diversification Opportunities for UCHUMI SUPERMARKET and DCB MERCIAL
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UCHUMI and DCB is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UCHUMI SUPERMARKET LTD and DCB MERCIAL BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DCB MERCIAL BANK and UCHUMI SUPERMARKET 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 UCHUMI SUPERMARKET LTD are associated (or correlated) with DCB MERCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DCB MERCIAL BANK has no effect on the direction of UCHUMI SUPERMARKET i.e., UCHUMI SUPERMARKET and DCB MERCIAL go up and down completely randomly.
Pair Corralation between UCHUMI SUPERMARKET and DCB MERCIAL
If you would invest 13,500 in DCB MERCIAL BANK on September 2, 2024 and sell it today you would earn a total of 2,000 from holding DCB MERCIAL BANK or generate 14.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UCHUMI SUPERMARKET LTD vs. DCB MERCIAL BANK
Performance |
| Timeline |
| UCHUMI SUPERMARKET LTD |
| DCB MERCIAL BANK |
UCHUMI SUPERMARKET and DCB MERCIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UCHUMI SUPERMARKET and DCB MERCIAL
The main advantage of trading using opposite UCHUMI SUPERMARKET and DCB MERCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UCHUMI SUPERMARKET position performs unexpectedly, DCB MERCIAL 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 DCB MERCIAL will offset losses from the drop in DCB MERCIAL's long position.| UCHUMI SUPERMARKET vs. EAST AFRICAN BREWERIES | UCHUMI SUPERMARKET vs. MKOMBOZI MERCIAL BANK | UCHUMI SUPERMARKET vs. TANZANIA CIGARETTE LTD | UCHUMI SUPERMARKET vs. SWISSPORT TANZANIA LTD |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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