Correlation Between National Bank and Credit Agricole
Can any of the company-specific risk be diversified away by investing in both National Bank 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 National Bank and Credit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank and Credit Agricole Egypt, you can compare the effects of market volatilities on National Bank 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 National Bank with a short position of Credit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Credit Agricole.
Diversification Opportunities for National Bank and Credit Agricole
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between National and Credit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank 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 National Bank 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 National Bank 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 National Bank i.e., National Bank and Credit Agricole go up and down completely randomly.
Pair Corralation between National Bank and Credit Agricole
Assuming the 90 days trading horizon National Bank is expected to under-perform the Credit Agricole. But the stock apears to be less risky and, when comparing its historical volatility, National Bank is 1.83 times less risky than Credit Agricole. The stock trades about -0.05 of its potential returns per unit of risk. The Credit Agricole Egypt is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 868.00 in Credit Agricole Egypt on August 24, 2024 and sell it today you would earn a total of 1,332 from holding Credit Agricole Egypt or generate 153.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
National Bank vs. Credit Agricole Egypt
Performance |
| Timeline |
| National Bank |
| Credit Agricole Egypt |
National Bank and Credit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Credit Agricole
The main advantage of trading using opposite National Bank and Credit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank 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.| National Bank vs. Paint Chemicals Industries | National Bank vs. Reacap Financial Investments | National Bank vs. Egyptians For Investment | National Bank vs. Misr Oils Soap |
| Credit Agricole vs. Paint Chemicals Industries | Credit Agricole vs. Reacap Financial Investments | Credit Agricole vs. Egyptians For Investment | Credit Agricole 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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