Correlation Between ZENITH BANK and NIGERIAN BREWERIES
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By analyzing existing cross correlation between ZENITH BANK PLC and NIGERIAN BREWERIES PLC, you can compare the effects of market volatilities on ZENITH BANK and NIGERIAN BREWERIES 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 ZENITH BANK with a short position of NIGERIAN BREWERIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZENITH BANK and NIGERIAN BREWERIES.
Diversification Opportunities for ZENITH BANK and NIGERIAN BREWERIES
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ZENITH and NIGERIAN is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding ZENITH BANK PLC and NIGERIAN BREWERIES PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NIGERIAN BREWERIES PLC and ZENITH BANK 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 ZENITH BANK PLC are associated (or correlated) with NIGERIAN BREWERIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NIGERIAN BREWERIES PLC has no effect on the direction of ZENITH BANK i.e., ZENITH BANK and NIGERIAN BREWERIES go up and down completely randomly.
Pair Corralation between ZENITH BANK and NIGERIAN BREWERIES
Assuming the 90 days trading horizon ZENITH BANK PLC is expected to generate 0.82 times more return on investment than NIGERIAN BREWERIES. However, ZENITH BANK PLC is 1.23 times less risky than NIGERIAN BREWERIES. It trades about 0.24 of its potential returns per unit of risk. NIGERIAN BREWERIES PLC is currently generating about 0.05 per unit of risk. If you would invest 3,930 in ZENITH BANK PLC on September 23, 2024 and sell it today you would earn a total of 655.00 from holding ZENITH BANK PLC or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZENITH BANK PLC vs. NIGERIAN BREWERIES PLC
Performance |
| Timeline |
| ZENITH BANK PLC |
| NIGERIAN BREWERIES PLC |
ZENITH BANK and NIGERIAN BREWERIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZENITH BANK and NIGERIAN BREWERIES
The main advantage of trading using opposite ZENITH BANK and NIGERIAN BREWERIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZENITH BANK position performs unexpectedly, NIGERIAN BREWERIES 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 NIGERIAN BREWERIES will offset losses from the drop in NIGERIAN BREWERIES's long position.| ZENITH BANK vs. GUINEA INSURANCE PLC | ZENITH BANK vs. SECURE ELECTRONIC TECHNOLOGY | ZENITH BANK vs. SFS REAL ESTATE | ZENITH BANK vs. CHELLARAMS PLC |
| NIGERIAN BREWERIES vs. ZENITH BANK PLC | NIGERIAN BREWERIES vs. GUINEA INSURANCE PLC | NIGERIAN BREWERIES vs. SECURE ELECTRONIC TECHNOLOGY | NIGERIAN BREWERIES vs. SFS REAL ESTATE |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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