Correlation Between Contact Financial and Grand Investment
Can any of the company-specific risk be diversified away by investing in both Contact Financial and Grand 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 Contact Financial and Grand Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Contact Financial Holding and Grand Investment Capital, you can compare the effects of market volatilities on Contact Financial and Grand 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 Contact Financial with a short position of Grand Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contact Financial and Grand Investment.
Diversification Opportunities for Contact Financial and Grand Investment
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Contact and Grand is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Contact Financial Holding and Grand Investment Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Investment Capital and Contact Financial 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 Contact Financial Holding are associated (or correlated) with Grand Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Investment Capital has no effect on the direction of Contact Financial i.e., Contact Financial and Grand Investment go up and down completely randomly.
Pair Corralation between Contact Financial and Grand Investment
Assuming the 90 days trading horizon Contact Financial Holding is expected to generate 1.03 times more return on investment than Grand Investment. However, Contact Financial is 1.03 times more volatile than Grand Investment Capital. It trades about 0.03 of its potential returns per unit of risk. Grand Investment Capital is currently generating about 0.03 per unit of risk. If you would invest 364.00 in Contact Financial Holding on October 27, 2024 and sell it today you would earn a total of 82.00 from holding Contact Financial Holding or generate 22.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Contact Financial Holding vs. Grand Investment Capital
Performance |
| Timeline |
| Contact Financial Holding |
| Grand Investment Capital |
Contact Financial and Grand Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Contact Financial and Grand Investment
The main advantage of trading using opposite Contact Financial and Grand Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contact Financial position performs unexpectedly, Grand 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 Grand Investment will offset losses from the drop in Grand Investment's long position.| Contact Financial vs. Dice Sport Casual | Contact Financial vs. Nozha International Hospital | Contact Financial vs. Delta Insurance | Contact Financial vs. Egyptian Transport |
| Grand Investment vs. ODIN Investments | Grand Investment vs. Reacap Financial Investments | Grand Investment vs. El Ahli Investment | Grand Investment vs. Misr Financial Investments |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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