Correlation Between ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA
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By analyzing existing cross correlation between ECOBANK TRANSNATIONAL INCORPORATED and VITAFOAM NIGERIA PLC, you can compare the effects of market volatilities on ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA 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 ECOBANK TRANSNATIONAL with a short position of VITAFOAM NIGERIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA.
Diversification Opportunities for ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ECOBANK and VITAFOAM is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding ECOBANK TRANSNATIONAL INCORPOR and VITAFOAM NIGERIA PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VITAFOAM NIGERIA PLC and ECOBANK TRANSNATIONAL 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 ECOBANK TRANSNATIONAL INCORPORATED are associated (or correlated) with VITAFOAM NIGERIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VITAFOAM NIGERIA PLC has no effect on the direction of ECOBANK TRANSNATIONAL i.e., ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA go up and down completely randomly.
Pair Corralation between ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA
Assuming the 90 days trading horizon ECOBANK TRANSNATIONAL is expected to generate 1.99 times less return on investment than VITAFOAM NIGERIA. But when comparing it to its historical volatility, ECOBANK TRANSNATIONAL INCORPORATED is 1.16 times less risky than VITAFOAM NIGERIA. It trades about 0.13 of its potential returns per unit of risk. VITAFOAM NIGERIA PLC is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 5,500 in VITAFOAM NIGERIA PLC on May 29, 2025 and sell it today you would earn a total of 2,690 from holding VITAFOAM NIGERIA PLC or generate 48.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ECOBANK TRANSNATIONAL INCORPOR vs. VITAFOAM NIGERIA PLC
Performance |
| Timeline |
| ECOBANK TRANSNATIONAL |
| VITAFOAM NIGERIA PLC |
ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA
The main advantage of trading using opposite ECOBANK TRANSNATIONAL and VITAFOAM NIGERIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ECOBANK TRANSNATIONAL position performs unexpectedly, VITAFOAM NIGERIA 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 VITAFOAM NIGERIA will offset losses from the drop in VITAFOAM NIGERIA's long position.| ECOBANK TRANSNATIONAL vs. CUSTODIAN INVESTMENT PLC | ECOBANK TRANSNATIONAL vs. UNITY BANK PLC | ECOBANK TRANSNATIONAL vs. ZENITH BANK PLC | ECOBANK TRANSNATIONAL vs. WEMA BANK PLC |
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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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.
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