Correlation Between VITAFOAM NIGERIA and CUSTODIAN INVESTMENT
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By analyzing existing cross correlation between VITAFOAM NIGERIA PLC and CUSTODIAN INVESTMENT PLC, you can compare the effects of market volatilities on VITAFOAM NIGERIA and CUSTODIAN INVESTMENT 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 VITAFOAM NIGERIA with a short position of CUSTODIAN INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of VITAFOAM NIGERIA and CUSTODIAN INVESTMENT.
Diversification Opportunities for VITAFOAM NIGERIA and CUSTODIAN INVESTMENT
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VITAFOAM and CUSTODIAN is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding VITAFOAM NIGERIA PLC and CUSTODIAN INVESTMENT PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CUSTODIAN INVESTMENT PLC and VITAFOAM 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 VITAFOAM NIGERIA PLC are associated (or correlated) with CUSTODIAN INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CUSTODIAN INVESTMENT PLC has no effect on the direction of VITAFOAM NIGERIA i.e., VITAFOAM NIGERIA and CUSTODIAN INVESTMENT go up and down completely randomly.
Pair Corralation between VITAFOAM NIGERIA and CUSTODIAN INVESTMENT
Assuming the 90 days trading horizon VITAFOAM NIGERIA is expected to generate 2.12 times less return on investment than CUSTODIAN INVESTMENT. But when comparing it to its historical volatility, VITAFOAM NIGERIA PLC is 1.34 times less risky than CUSTODIAN INVESTMENT. It trades about 0.18 of its potential returns per unit of risk. CUSTODIAN INVESTMENT PLC is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 2,000 in CUSTODIAN INVESTMENT PLC on May 27, 2025 and sell it today you would earn a total of 2,075 from holding CUSTODIAN INVESTMENT PLC or generate 103.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VITAFOAM NIGERIA PLC vs. CUSTODIAN INVESTMENT PLC
Performance |
| Timeline |
| VITAFOAM NIGERIA PLC |
| CUSTODIAN INVESTMENT PLC |
VITAFOAM NIGERIA and CUSTODIAN INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VITAFOAM NIGERIA and CUSTODIAN INVESTMENT
The main advantage of trading using opposite VITAFOAM NIGERIA and CUSTODIAN INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VITAFOAM NIGERIA position performs unexpectedly, CUSTODIAN INVESTMENT 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 CUSTODIAN INVESTMENT will offset losses from the drop in CUSTODIAN INVESTMENT's long position.| VITAFOAM NIGERIA vs. FORTIS GLOBAL INSURANCE | VITAFOAM NIGERIA vs. STACO INSURANCE PLC | VITAFOAM NIGERIA vs. AXAMANSARD INSURANCE PLC | VITAFOAM NIGERIA vs. CUSTODIAN INVESTMENT 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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