Correlation Between SOVEREIGN TRUST and GUINEA INSURANCE
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By analyzing existing cross correlation between SOVEREIGN TRUST INSURANCE and GUINEA INSURANCE PLC, you can compare the effects of market volatilities on SOVEREIGN TRUST 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 SOVEREIGN TRUST with a short position of GUINEA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOVEREIGN TRUST and GUINEA INSURANCE.
Diversification Opportunities for SOVEREIGN TRUST and GUINEA INSURANCE
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SOVEREIGN and GUINEA is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding SOVEREIGN TRUST INSURANCE 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 SOVEREIGN TRUST 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 SOVEREIGN TRUST INSURANCE 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 SOVEREIGN TRUST i.e., SOVEREIGN TRUST and GUINEA INSURANCE go up and down completely randomly.
Pair Corralation between SOVEREIGN TRUST and GUINEA INSURANCE
Assuming the 90 days trading horizon SOVEREIGN TRUST INSURANCE is expected to generate 0.89 times more return on investment than GUINEA INSURANCE. However, SOVEREIGN TRUST INSURANCE is 1.13 times less risky than GUINEA INSURANCE. It trades about 0.12 of its potential returns per unit of risk. GUINEA INSURANCE PLC is currently generating about 0.06 per unit of risk. If you would invest 99.00 in SOVEREIGN TRUST INSURANCE on March 27, 2025 and sell it today you would earn a total of 31.00 from holding SOVEREIGN TRUST INSURANCE or generate 31.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOVEREIGN TRUST INSURANCE vs. GUINEA INSURANCE PLC
Performance |
| Timeline |
| SOVEREIGN TRUST INSURANCE |
| GUINEA INSURANCE PLC |
SOVEREIGN TRUST and GUINEA INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOVEREIGN TRUST and GUINEA INSURANCE
The main advantage of trading using opposite SOVEREIGN TRUST and GUINEA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOVEREIGN TRUST 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.| SOVEREIGN TRUST vs. ZENITH BANK PLC | SOVEREIGN TRUST vs. TOTALENERGIES MARKETING NIGERIA | SOVEREIGN TRUST vs. STERLING FINANCIAL HOLDINGS | SOVEREIGN TRUST vs. BUA FOODS PLC |
| GUINEA INSURANCE vs. CORONATION INSURANCE PLC | GUINEA INSURANCE vs. UNION HOMES REAL | GUINEA INSURANCE vs. SOVEREIGN TRUST INSURANCE | GUINEA INSURANCE vs. BUA FOODS 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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