Correlation Between Telecom Egypt and National Bank
Can any of the company-specific risk be diversified away by investing in both Telecom Egypt and National Bank 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 Telecom Egypt and National Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telecom Egypt and National Bank, you can compare the effects of market volatilities on Telecom Egypt and National Bank 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 Telecom Egypt with a short position of National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telecom Egypt and National Bank.
Diversification Opportunities for Telecom Egypt and National Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Telecom and National is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Telecom Egypt and National Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank and Telecom Egypt 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 Telecom Egypt are associated (or correlated) with National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank has no effect on the direction of Telecom Egypt i.e., Telecom Egypt and National Bank go up and down completely randomly.
Pair Corralation between Telecom Egypt and National Bank
If you would invest 3,420 in Telecom Egypt on October 12, 2024 and sell it today you would earn a total of 101.00 from holding Telecom Egypt or generate 2.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Telecom Egypt vs. National Bank
Performance |
| Timeline |
| Telecom Egypt |
| National Bank |
Telecom Egypt and National Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telecom Egypt and National Bank
The main advantage of trading using opposite Telecom Egypt and National Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telecom Egypt position performs unexpectedly, National Bank 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 National Bank will offset losses from the drop in National Bank's long position.| Telecom Egypt vs. Copper For Commercial | Telecom Egypt vs. Reacap Financial Investments | Telecom Egypt vs. Saudi Egyptian Investment | Telecom Egypt vs. Mohandes Insurance |
| National Bank vs. Orascom Construction PLC | National Bank vs. Misr Financial Investments | National Bank vs. Egyptians For Investment | National Bank vs. Misr Chemical Industries |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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