Correlation Between Orascom Investment and Grand Investment
Can any of the company-specific risk be diversified away by investing in both Orascom Investment and Grand Investment 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 Grand Investment 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 Grand Investment Capital, you can compare the effects of market volatilities on Orascom Investment and Grand Investment 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 Grand Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orascom Investment and Grand Investment.
Diversification Opportunities for Orascom Investment and Grand Investment
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Orascom and Grand is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Orascom Investment Holding and Grand Investment Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Investment Capital 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 Grand Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Investment Capital has no effect on the direction of Orascom Investment i.e., Orascom Investment and Grand Investment go up and down completely randomly.
Pair Corralation between Orascom Investment and Grand Investment
Assuming the 90 days trading horizon Orascom Investment Holding is expected to under-perform the Grand Investment. But the stock apears to be less risky and, when comparing its historical volatility, Orascom Investment Holding is 1.08 times less risky than Grand Investment. The stock trades about -0.03 of its potential returns per unit of risk. The Grand Investment Capital is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,030 in Grand Investment Capital on November 4, 2024 and sell it today you would earn a total of 19.00 from holding Grand Investment Capital or generate 1.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orascom Investment Holding vs. Grand Investment Capital
Performance |
| Timeline |
| Orascom Investment |
| Grand Investment Capital |
Orascom Investment and Grand Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orascom Investment and Grand Investment
The main advantage of trading using opposite Orascom Investment and Grand Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orascom Investment position performs unexpectedly, Grand Investment 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 Grand Investment will offset losses from the drop in Grand Investment's long position.| Orascom Investment vs. Paint Chemicals Industries | Orascom Investment vs. Reacap Financial Investments | Orascom Investment vs. Egyptians For Investment | Orascom Investment vs. Misr Oils Soap |
| Grand Investment vs. Act Financial | Grand Investment vs. Mohandes Insurance | Grand Investment vs. Qatar Natl Bank | Grand Investment vs. Dice Sport Casual |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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