Correlation Between National Bank and Contact Financial
Can any of the company-specific risk be diversified away by investing in both National Bank and Contact Financial 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 Contact Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank and Contact Financial Holding, you can compare the effects of market volatilities on National Bank and Contact Financial 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 Contact Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Contact Financial.
Diversification Opportunities for National Bank and Contact Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between National and Contact is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank and Contact Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contact Financial Holding 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 Contact Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contact Financial Holding has no effect on the direction of National Bank i.e., National Bank and Contact Financial go up and down completely randomly.
Pair Corralation between National Bank and Contact Financial
If you would invest 404.00 in Contact Financial Holding on October 26, 2024 and sell it today you would earn a total of 42.00 from holding Contact Financial Holding or generate 10.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank vs. Contact Financial Holding
Performance |
| Timeline |
| National Bank |
| Contact Financial Holding |
National Bank and Contact Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Contact Financial
The main advantage of trading using opposite National Bank and Contact Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Contact Financial 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 Contact Financial will offset losses from the drop in Contact Financial'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 |
| Contact Financial vs. Paint Chemicals Industries | Contact Financial vs. Reacap Financial Investments | Contact Financial vs. Egyptians For Investment | Contact Financial 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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