Correlation Between National Bank and Misr Hotels
Can any of the company-specific risk be diversified away by investing in both National Bank and Misr Hotels 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 Misr Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank and Misr Hotels, you can compare the effects of market volatilities on National Bank and Misr Hotels 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 Misr Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Misr Hotels.
Diversification Opportunities for National Bank and Misr Hotels
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between National and Misr is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank and Misr Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Misr Hotels 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 Misr Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Misr Hotels has no effect on the direction of National Bank i.e., National Bank and Misr Hotels go up and down completely randomly.
Pair Corralation between National Bank and Misr Hotels
If you would invest 1,300 in National Bank on August 30, 2024 and sell it today you would earn a total of 0.00 from holding National Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
National Bank vs. Misr Hotels
Performance |
| Timeline |
| National Bank |
| Misr Hotels |
National Bank and Misr Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Misr Hotels
The main advantage of trading using opposite National Bank and Misr Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Misr Hotels 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 Misr Hotels will offset losses from the drop in Misr Hotels' long position.| National Bank vs. Paint Chemicals Industries | National Bank vs. Egyptians For Investment | National Bank vs. Misr Oils Soap | National Bank vs. Global Telecom Holding |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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