Correlation Between NORTHERN NIGERIA and GUINEA INSURANCE
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By analyzing existing cross correlation between NORTHERN NIGERIA FLOUR and GUINEA INSURANCE PLC, you can compare the effects of market volatilities on NORTHERN NIGERIA and GUINEA INSURANCE 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 NORTHERN NIGERIA with a short position of GUINEA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of NORTHERN NIGERIA and GUINEA INSURANCE.
Diversification Opportunities for NORTHERN NIGERIA and GUINEA INSURANCE
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NORTHERN and GUINEA is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding NORTHERN NIGERIA FLOUR and GUINEA INSURANCE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GUINEA INSURANCE PLC and NORTHERN NIGERIA 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 NORTHERN NIGERIA FLOUR are associated (or correlated) with GUINEA INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GUINEA INSURANCE PLC has no effect on the direction of NORTHERN NIGERIA i.e., NORTHERN NIGERIA and GUINEA INSURANCE go up and down completely randomly.
Pair Corralation between NORTHERN NIGERIA and GUINEA INSURANCE
Assuming the 90 days trading horizon NORTHERN NIGERIA FLOUR is expected to generate 0.89 times more return on investment than GUINEA INSURANCE. However, NORTHERN NIGERIA FLOUR is 1.12 times less risky than GUINEA INSURANCE. It trades about 0.11 of its potential returns per unit of risk. GUINEA INSURANCE PLC is currently generating about 0.09 per unit of risk. If you would invest 7,980 in NORTHERN NIGERIA FLOUR on March 27, 2025 and sell it today you would earn a total of 2,150 from holding NORTHERN NIGERIA FLOUR or generate 26.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.25% |
| Values | Daily Returns |
NORTHERN NIGERIA FLOUR vs. GUINEA INSURANCE PLC
Performance |
| Timeline |
| NORTHERN NIGERIA FLOUR |
| GUINEA INSURANCE PLC |
NORTHERN NIGERIA and GUINEA INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NORTHERN NIGERIA and GUINEA INSURANCE
The main advantage of trading using opposite NORTHERN NIGERIA and GUINEA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NORTHERN NIGERIA position performs unexpectedly, GUINEA INSURANCE 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 GUINEA INSURANCE will offset losses from the drop in GUINEA INSURANCE's long position.| NORTHERN NIGERIA vs. STACO INSURANCE PLC | NORTHERN NIGERIA vs. ASO SAVINGS AND | NORTHERN NIGERIA vs. LIVINGTRUST MORTGAGE BANK | NORTHERN NIGERIA vs. AIICO INSURANCE 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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