Correlation Between Al Shaheer and IBL HealthCare
Can any of the company-specific risk be diversified away by investing in both Al Shaheer and IBL HealthCare 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 Al Shaheer and IBL HealthCare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Al Shaheer and IBL HealthCare, you can compare the effects of market volatilities on Al Shaheer and IBL HealthCare 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 Al Shaheer with a short position of IBL HealthCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Al Shaheer and IBL HealthCare.
Diversification Opportunities for Al Shaheer and IBL HealthCare
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ASC and IBL is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Al Shaheer and IBL HealthCare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IBL HealthCare and Al Shaheer 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 Al Shaheer are associated (or correlated) with IBL HealthCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IBL HealthCare has no effect on the direction of Al Shaheer i.e., Al Shaheer and IBL HealthCare go up and down completely randomly.
Pair Corralation between Al Shaheer and IBL HealthCare
Assuming the 90 days trading horizon Al Shaheer is expected to generate 1.53 times more return on investment than IBL HealthCare. However, Al Shaheer is 1.53 times more volatile than IBL HealthCare. It trades about -0.08 of its potential returns per unit of risk. IBL HealthCare is currently generating about -0.2 per unit of risk. If you would invest 660.00 in Al Shaheer on November 28, 2024 and sell it today you would lose (26.00) from holding Al Shaheer or give up 3.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Al Shaheer vs. IBL HealthCare
Performance |
| Timeline |
| Al Shaheer |
| IBL HealthCare |
Al Shaheer and IBL HealthCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Al Shaheer and IBL HealthCare
The main advantage of trading using opposite Al Shaheer and IBL HealthCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Al Shaheer position performs unexpectedly, IBL HealthCare 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 IBL HealthCare will offset losses from the drop in IBL HealthCare's long position.| Al Shaheer vs. Pakistan Synthetics | Al Shaheer vs. Habib Insurance | Al Shaheer vs. Silkbank | Al Shaheer vs. Engro Polymer Chemicals |
| IBL HealthCare vs. Nimir Industrial Chemical | IBL HealthCare vs. Air Link Communication | IBL HealthCare vs. Beco Steel | IBL HealthCare vs. Hi Tech Lubricants |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |