Correlation Between TOTALENERGIES MARKETING and CORONATION INSURANCE

Can any of the company-specific risk be diversified away by investing in both TOTALENERGIES MARKETING and CORONATION INSURANCE at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining TOTALENERGIES MARKETING and CORONATION INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TOTALENERGIES MARKETING NIGERIA and CORONATION INSURANCE PLC, you can compare the effects of market volatilities on TOTALENERGIES MARKETING and CORONATION 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 TOTALENERGIES MARKETING with a short position of CORONATION INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOTALENERGIES MARKETING and CORONATION INSURANCE.

Diversification Opportunities for TOTALENERGIES MARKETING and CORONATION INSURANCE

0.0

Correlation Coefficient

TOTALENERGIES MARKETING  CORONATION INSURANCE

Pay attention - limited upside

The 3 months correlation between TOTALENERGIES and CORONATION is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TOTALENERGIES MARKETING NIGERI and CORONATION INSURANCE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CORONATION INSURANCE PLC and TOTALENERGIES MARKETING 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 TOTALENERGIES MARKETING NIGERIA are associated (or correlated) with CORONATION INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CORONATION INSURANCE PLC has no effect on the direction of TOTALENERGIES MARKETING i.e., TOTALENERGIES MARKETING and CORONATION INSURANCE go up and down completely randomly.

Pair Corralation between TOTALENERGIES MARKETING and CORONATION INSURANCE

If you would invest  79.00  in CORONATION INSURANCE PLC on September 12, 2024 and sell it today you would earn a total of  40.00  from holding CORONATION INSURANCE PLC or generate 50.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

TOTALENERGIES MARKETING NIGERI  vs.  CORONATION INSURANCE PLC

TOTALENERGIES MARKETING

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TOTALENERGIES MARKETING NIGERIA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, TOTALENERGIES MARKETING is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

CORONATION INSURANCE PLC

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CORONATION INSURANCE PLC are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent forward indicators, CORONATION INSURANCE showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with TOTALENERGIES MARKETING and CORONATION INSURANCE

The main advantage of trading using opposite TOTALENERGIES MARKETING and CORONATION INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOTALENERGIES MARKETING position performs unexpectedly, CORONATION 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 CORONATION INSURANCE will offset losses from the drop in CORONATION INSURANCE's long position.

The idea behind TOTALENERGIES MARKETING NIGERIA and CORONATION INSURANCE PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.