Correlation Between National Bank and Misr Oils
Can any of the company-specific risk be diversified away by investing in both National Bank and Misr Oils 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 Oils 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 Oils Soap, you can compare the effects of market volatilities on National Bank and Misr Oils 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 Oils. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Misr Oils.
Diversification Opportunities for National Bank and Misr Oils
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 Oils Soap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Misr Oils Soap 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 Oils. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Misr Oils Soap has no effect on the direction of National Bank i.e., National Bank and Misr Oils go up and down completely randomly.
Pair Corralation between National Bank and Misr Oils
Assuming the 90 days trading horizon National Bank is expected to under-perform the Misr Oils. But the stock apears to be less risky and, when comparing its historical volatility, National Bank is 1.47 times less risky than Misr Oils. The stock trades about -0.06 of its potential returns per unit of risk. The Misr Oils Soap is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,500 in Misr Oils Soap on September 2, 2024 and sell it today you would earn a total of 3,710 from holding Misr Oils Soap or generate 148.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank vs. Misr Oils Soap
Performance |
| Timeline |
| National Bank |
| Misr Oils Soap |
National Bank and Misr Oils Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Misr Oils
The main advantage of trading using opposite National Bank and Misr Oils positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Misr Oils 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 Oils will offset losses from the drop in Misr Oils' long position.| National Bank vs. Egyptians For Investment | National Bank vs. Misr Oils Soap | National Bank vs. Global Telecom Holding | National Bank vs. Qatar Natl Bank |
| Misr Oils vs. Egyptians For Investment | Misr Oils vs. Global Telecom Holding | Misr Oils vs. Qatar Natl Bank | Misr Oils vs. Orascom Construction PLC |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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