Correlation Between International Company and Credit Agricole
Can any of the company-specific risk be diversified away by investing in both International Company and Credit Agricole 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 International Company and Credit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Company For and Credit Agricole Egypt, you can compare the effects of market volatilities on International Company and Credit Agricole 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 International Company with a short position of Credit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Company and Credit Agricole.
Diversification Opportunities for International Company and Credit Agricole
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and Credit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding International Company For and Credit Agricole Egypt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Agricole Egypt and International Company 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 International Company For are associated (or correlated) with Credit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Agricole Egypt has no effect on the direction of International Company i.e., International Company and Credit Agricole go up and down completely randomly.
Pair Corralation between International Company and Credit Agricole
Assuming the 90 days trading horizon International Company For is expected to under-perform the Credit Agricole. But the stock apears to be less risky and, when comparing its historical volatility, International Company For is 182.73 times less risky than Credit Agricole. The stock trades about -0.07 of its potential returns per unit of risk. The Credit Agricole Egypt is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,963 in Credit Agricole Egypt on September 20, 2024 and sell it today you would earn a total of 30.00 from holding Credit Agricole Egypt or generate 1.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
International Company For vs. Credit Agricole Egypt
Performance |
Timeline |
International Company |
Credit Agricole Egypt |
International Company and Credit Agricole Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with International Company and Credit Agricole
The main advantage of trading using opposite International Company and Credit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Company position performs unexpectedly, Credit Agricole 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 Credit Agricole will offset losses from the drop in Credit Agricole's long position.International Company vs. Credit Agricole Egypt | International Company vs. Arab Aluminum | International Company vs. Orascom Financial Holding | International Company vs. Juhayna Food Industries |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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