Correlation Between Qatar Natl and Orascom Investment
Can any of the company-specific risk be diversified away by investing in both Qatar Natl and Orascom 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 Qatar Natl and Orascom Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qatar Natl Bank and Orascom Investment Holding, you can compare the effects of market volatilities on Qatar Natl and Orascom 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 Qatar Natl with a short position of Orascom Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qatar Natl and Orascom Investment.
Diversification Opportunities for Qatar Natl and Orascom Investment
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Qatar and Orascom is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Qatar Natl Bank and Orascom Investment Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orascom Investment and Qatar Natl 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 Qatar Natl Bank are associated (or correlated) with Orascom Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orascom Investment has no effect on the direction of Qatar Natl i.e., Qatar Natl and Orascom Investment go up and down completely randomly.
Pair Corralation between Qatar Natl and Orascom Investment
Assuming the 90 days trading horizon Qatar Natl Bank is expected to under-perform the Orascom Investment. But the stock apears to be less risky and, when comparing its historical volatility, Qatar Natl Bank is 3.29 times less risky than Orascom Investment. The stock trades about -0.73 of its potential returns per unit of risk. The Orascom Investment Holding is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 55.00 in Orascom Investment Holding on November 5, 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 Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qatar Natl Bank vs. Orascom Investment Holding
Performance |
| Timeline |
| Qatar Natl Bank |
| Orascom Investment |
Qatar Natl and Orascom Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qatar Natl and Orascom Investment
The main advantage of trading using opposite Qatar Natl and Orascom Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qatar Natl position performs unexpectedly, Orascom 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 Orascom Investment will offset losses from the drop in Orascom Investment's long position.| Qatar Natl vs. Mohandes Insurance | Qatar Natl vs. Credit Agricole Egypt | Qatar Natl vs. Edita Food Industries | Qatar Natl vs. Faisal Islamic Bank |
| Orascom Investment vs. Misr Hotels | Orascom Investment vs. Saudi Egyptian Investment | Orascom Investment vs. Iron And Steel | Orascom Investment vs. Al Tawfeek Leasing |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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