Correlation Between Orascom Investment and Elsaeed Contracting
Can any of the company-specific risk be diversified away by investing in both Orascom Investment and Elsaeed Contracting 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 Elsaeed Contracting 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 Elsaeed Contracting Real, you can compare the effects of market volatilities on Orascom Investment and Elsaeed Contracting 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 Elsaeed Contracting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orascom Investment and Elsaeed Contracting.
Diversification Opportunities for Orascom Investment and Elsaeed Contracting
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Orascom and Elsaeed is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Orascom Investment Holding and Elsaeed Contracting Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elsaeed Contracting Real 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 Elsaeed Contracting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elsaeed Contracting Real has no effect on the direction of Orascom Investment i.e., Orascom Investment and Elsaeed Contracting go up and down completely randomly.
Pair Corralation between Orascom Investment and Elsaeed Contracting
Assuming the 90 days trading horizon Orascom Investment Holding is expected to generate 1.23 times more return on investment than Elsaeed Contracting. However, Orascom Investment is 1.23 times more volatile than Elsaeed Contracting Real. It trades about 0.05 of its potential returns per unit of risk. Elsaeed Contracting Real is currently generating about 0.05 per unit of risk. If you would invest 42.00 in Orascom Investment Holding on September 14, 2024 and sell it today you would earn a total of 9.00 from holding Orascom Investment Holding or generate 21.43% 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. Elsaeed Contracting Real
Performance |
| Timeline |
| Orascom Investment |
| Elsaeed Contracting Real |
Orascom Investment and Elsaeed Contracting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orascom Investment and Elsaeed Contracting
The main advantage of trading using opposite Orascom Investment and Elsaeed Contracting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orascom Investment position performs unexpectedly, Elsaeed Contracting 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 Elsaeed Contracting will offset losses from the drop in Elsaeed Contracting'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 |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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