Correlation Between Mari Petroleum and Bilal Fibres
Can any of the company-specific risk be diversified away by investing in both Mari Petroleum and Bilal Fibres 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 Mari Petroleum and Bilal Fibres into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mari Petroleum and Bilal Fibres, you can compare the effects of market volatilities on Mari Petroleum and Bilal Fibres 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 Mari Petroleum with a short position of Bilal Fibres. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mari Petroleum and Bilal Fibres.
Diversification Opportunities for Mari Petroleum and Bilal Fibres
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mari and Bilal is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Mari Petroleum and Bilal Fibres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilal Fibres and Mari Petroleum 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 Mari Petroleum are associated (or correlated) with Bilal Fibres. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilal Fibres has no effect on the direction of Mari Petroleum i.e., Mari Petroleum and Bilal Fibres go up and down completely randomly.
Pair Corralation between Mari Petroleum and Bilal Fibres
Assuming the 90 days trading horizon Mari Petroleum is expected to generate 0.86 times more return on investment than Bilal Fibres. However, Mari Petroleum is 1.17 times less risky than Bilal Fibres. It trades about 0.12 of its potential returns per unit of risk. Bilal Fibres is currently generating about 0.09 per unit of risk. If you would invest 2,295 in Mari Petroleum on August 30, 2024 and sell it today you would earn a total of 43,499 from holding Mari Petroleum or generate 1895.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 80.41% |
| Values | Daily Returns |
Mari Petroleum vs. Bilal Fibres
Performance |
| Timeline |
| Mari Petroleum |
| Bilal Fibres |
Mari Petroleum and Bilal Fibres Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mari Petroleum and Bilal Fibres
The main advantage of trading using opposite Mari Petroleum and Bilal Fibres positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mari Petroleum position performs unexpectedly, Bilal Fibres 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 Bilal Fibres will offset losses from the drop in Bilal Fibres' long position.| Mari Petroleum vs. Habib Bank | Mari Petroleum vs. National Bank of | Mari Petroleum vs. United Bank | Mari Petroleum vs. MCB Bank |
| Bilal Fibres vs. Big Bird Foods | Bilal Fibres vs. Matco Foods | Bilal Fibres vs. Adamjee Insurance | Bilal Fibres vs. AKD Hospitality |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |