Correlation Between QALA For and Orascom Investment
Can any of the company-specific risk be diversified away by investing in both QALA For and Orascom Investment 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 QALA For and Orascom Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between QALA For Financial and Orascom Investment Holding, you can compare the effects of market volatilities on QALA For and Orascom 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 QALA For with a short position of Orascom Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of QALA For and Orascom Investment.
Diversification Opportunities for QALA For and Orascom Investment
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between QALA and Orascom is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding QALA For Financial and Orascom Investment Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orascom Investment and QALA For 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 QALA For Financial are associated (or correlated) with Orascom Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orascom Investment has no effect on the direction of QALA For i.e., QALA For and Orascom Investment go up and down completely randomly.
Pair Corralation between QALA For and Orascom Investment
Assuming the 90 days trading horizon QALA For Financial is expected to generate 1.26 times more return on investment than Orascom Investment. However, QALA For is 1.26 times more volatile than Orascom Investment Holding. It trades about 0.28 of its potential returns per unit of risk. Orascom Investment Holding is currently generating about -0.03 per unit of risk. If you would invest 239.00 in QALA For Financial on November 4, 2024 and sell it today you would earn a total of 34.00 from holding QALA For Financial or generate 14.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
QALA For Financial vs. Orascom Investment Holding
Performance |
| Timeline |
| QALA For Financial |
| Orascom Investment |
QALA For and Orascom Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QALA For and Orascom Investment
The main advantage of trading using opposite QALA For and Orascom Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QALA For position performs unexpectedly, Orascom 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 Orascom Investment will offset losses from the drop in Orascom Investment's long position.| QALA For vs. Iron And Steel | QALA For vs. Nile City Investment | QALA For vs. Arab Moltaka Investments | QALA For vs. Golden Textiles Clothes |
| Orascom Investment vs. Paint Chemicals Industries | Orascom Investment vs. Reacap Financial Investments | Orascom Investment vs. Egyptians For Investment | Orascom Investment vs. Misr Oils Soap |
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 CEOs Directory module to screen CEOs from public companies around the world.
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