Correlation Between National Bank and Egyptian Gulf
Can any of the company-specific risk be diversified away by investing in both National Bank and Egyptian Gulf 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 Egyptian Gulf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank and Egyptian Gulf Bank, you can compare the effects of market volatilities on National Bank and Egyptian Gulf 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 Egyptian Gulf. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Egyptian Gulf.
Diversification Opportunities for National Bank and Egyptian Gulf
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between National and Egyptian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank and Egyptian Gulf Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Egyptian Gulf Bank 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 Egyptian Gulf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Egyptian Gulf Bank has no effect on the direction of National Bank i.e., National Bank and Egyptian Gulf go up and down completely randomly.
Pair Corralation between National Bank and Egyptian Gulf
If you would invest 27.00 in Egyptian Gulf Bank on November 3, 2024 and sell it today you would earn a total of 1.00 from holding Egyptian Gulf Bank or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank vs. Egyptian Gulf Bank
Performance |
| Timeline |
| National Bank |
| Egyptian Gulf Bank |
National Bank and Egyptian Gulf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Egyptian Gulf
The main advantage of trading using opposite National Bank and Egyptian Gulf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Egyptian Gulf 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 Egyptian Gulf will offset losses from the drop in Egyptian Gulf's long position.| National Bank vs. Paint Chemicals Industries | National Bank vs. Saudi Egyptian Investment | National Bank vs. Ezz Steel | National Bank vs. Cairo Educational Services |
| Egyptian Gulf vs. Orascom Financial Holding | Egyptian Gulf vs. Housing Development Bank | Egyptian Gulf vs. National Bank | Egyptian Gulf vs. Orascom Investment Holding |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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