Correlation Between Orascom Investment and B Investments
Can any of the company-specific risk be diversified away by investing in both Orascom Investment and B Investments 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 Orascom Investment and B Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orascom Investment Holding and B Investments Holding, you can compare the effects of market volatilities on Orascom Investment and B Investments 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 Orascom Investment with a short position of B Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orascom Investment and B Investments.
Diversification Opportunities for Orascom Investment and B Investments
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Orascom and BINV is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Orascom Investment Holding and B Investments Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on B Investments Holding and Orascom Investment 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 Orascom Investment Holding are associated (or correlated) with B Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of B Investments Holding has no effect on the direction of Orascom Investment i.e., Orascom Investment and B Investments go up and down completely randomly.
Pair Corralation between Orascom Investment and B Investments
Assuming the 90 days trading horizon Orascom Investment Holding is expected to generate 1.46 times more return on investment than B Investments. However, Orascom Investment is 1.46 times more volatile than B Investments Holding. It trades about -0.03 of its potential returns per unit of risk. B Investments Holding is currently generating about -0.12 per unit of risk. If you would invest 55.00 in Orascom Investment Holding on November 4, 2024 and sell it today you would lose (1.00) from holding Orascom Investment Holding or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orascom Investment Holding vs. B Investments Holding
Performance |
| Timeline |
| Orascom Investment |
| B Investments Holding |
Orascom Investment and B Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orascom Investment and B Investments
The main advantage of trading using opposite Orascom Investment and B Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orascom Investment position performs unexpectedly, B Investments 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 B Investments will offset losses from the drop in B Investments' long position.| Orascom Investment vs. Cairo Educational Services | Orascom Investment vs. Copper For Commercial | Orascom Investment vs. Dice Sport Casual | Orascom Investment vs. Egyptians For Investment |
| B Investments vs. Orascom Investment Holding | B Investments vs. Cairo Oils Soap | B Investments vs. ODIN Investments | B Investments vs. Natural Gas Mining |
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 CEOs Directory module to screen CEOs from public companies around the world.
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