Correlation Between WEMA BANK and VETIVA BANKING
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By analyzing existing cross correlation between WEMA BANK PLC and VETIVA BANKING ETF, you can compare the effects of market volatilities on WEMA BANK and VETIVA BANKING 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 WEMA BANK with a short position of VETIVA BANKING. Check out your portfolio center. Please also check ongoing floating volatility patterns of WEMA BANK and VETIVA BANKING.
Diversification Opportunities for WEMA BANK and VETIVA BANKING
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between WEMA and VETIVA is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding WEMA BANK PLC and VETIVA BANKING ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VETIVA BANKING ETF and WEMA 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 WEMA BANK PLC are associated (or correlated) with VETIVA BANKING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VETIVA BANKING ETF has no effect on the direction of WEMA BANK i.e., WEMA BANK and VETIVA BANKING go up and down completely randomly.
Pair Corralation between WEMA BANK and VETIVA BANKING
Assuming the 90 days trading horizon WEMA BANK is expected to generate 1.11 times less return on investment than VETIVA BANKING. But when comparing it to its historical volatility, WEMA BANK PLC is 1.51 times less risky than VETIVA BANKING. It trades about 0.46 of its potential returns per unit of risk. VETIVA BANKING ETF is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 1,250 in VETIVA BANKING ETF on April 24, 2025 and sell it today you would earn a total of 330.00 from holding VETIVA BANKING ETF or generate 26.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WEMA BANK PLC vs. VETIVA BANKING ETF
Performance |
| Timeline |
| WEMA BANK PLC |
| VETIVA BANKING ETF |
WEMA BANK and VETIVA BANKING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WEMA BANK and VETIVA BANKING
The main advantage of trading using opposite WEMA BANK and VETIVA BANKING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WEMA BANK position performs unexpectedly, VETIVA BANKING 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 VETIVA BANKING will offset losses from the drop in VETIVA BANKING's long position.| WEMA BANK vs. NIGERIAN BREWERIES PLC | WEMA BANK vs. UNITED BANK FOR | WEMA BANK vs. CUSTODIAN INVESTMENT PLC | WEMA BANK vs. CORONATION 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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