Correlation Between Sidi Kerir and Credit Agricole
Can any of the company-specific risk be diversified away by investing in both Sidi Kerir and Credit Agricole 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 Sidi Kerir and Credit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sidi Kerir Petrochemicals and Credit Agricole Egypt, you can compare the effects of market volatilities on Sidi Kerir and Credit Agricole 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 Sidi Kerir with a short position of Credit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sidi Kerir and Credit Agricole.
Diversification Opportunities for Sidi Kerir and Credit Agricole
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sidi and Credit is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sidi Kerir Petrochemicals and Credit Agricole Egypt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Agricole Egypt and Sidi Kerir 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 Sidi Kerir Petrochemicals are associated (or correlated) with Credit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Agricole Egypt has no effect on the direction of Sidi Kerir i.e., Sidi Kerir and Credit Agricole go up and down completely randomly.
Pair Corralation between Sidi Kerir and Credit Agricole
Assuming the 90 days trading horizon Sidi Kerir is expected to generate 1.12 times less return on investment than Credit Agricole. In addition to that, Sidi Kerir is 1.23 times more volatile than Credit Agricole Egypt. It trades about 0.07 of its total potential returns per unit of risk. Credit Agricole Egypt is currently generating about 0.09 per unit of volatility. If you would invest 868.00 in Credit Agricole Egypt on August 24, 2024 and sell it today you would earn a total of 1,332 from holding Credit Agricole Egypt or generate 153.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sidi Kerir Petrochemicals vs. Credit Agricole Egypt
Performance |
| Timeline |
| Sidi Kerir Petrochemicals |
| Credit Agricole Egypt |
Sidi Kerir and Credit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sidi Kerir and Credit Agricole
The main advantage of trading using opposite Sidi Kerir and Credit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sidi Kerir position performs unexpectedly, Credit Agricole 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 Credit Agricole will offset losses from the drop in Credit Agricole's long position.| Sidi Kerir vs. Paint Chemicals Industries | Sidi Kerir vs. Reacap Financial Investments | Sidi Kerir vs. Egyptians For Investment | Sidi Kerir vs. Misr Oils Soap |
| Credit Agricole vs. Paint Chemicals Industries | Credit Agricole vs. Reacap Financial Investments | Credit Agricole vs. Egyptians For Investment | Credit Agricole vs. Misr Oils Soap |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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