Correlation Between ATTIJARIWAFA BANK and HIGHTECH PAYMENT

Can any of the company-specific risk be diversified away by investing in both ATTIJARIWAFA BANK and HIGHTECH PAYMENT 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 ATTIJARIWAFA BANK and HIGHTECH PAYMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ATTIJARIWAFA BANK and HIGHTECH PAYMENT SYSTEMS, you can compare the effects of market volatilities on ATTIJARIWAFA BANK and HIGHTECH PAYMENT 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 ATTIJARIWAFA BANK with a short position of HIGHTECH PAYMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATTIJARIWAFA BANK and HIGHTECH PAYMENT.

Diversification Opportunities for ATTIJARIWAFA BANK and HIGHTECH PAYMENT

-0.67

Correlation Coefficient

ATTIJARIWAFA BANK  HIGHTECH PAYMENT

Excellent diversification

The 3 months correlation between ATTIJARIWAFA and HIGHTECH is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding ATTIJARIWAFA BANK and HIGHTECH PAYMENT SYSTEMS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HIGHTECH PAYMENT SYSTEMS and ATTIJARIWAFA BANK 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 ATTIJARIWAFA BANK are associated (or correlated) with HIGHTECH PAYMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HIGHTECH PAYMENT SYSTEMS has no effect on the direction of ATTIJARIWAFA BANK i.e., ATTIJARIWAFA BANK and HIGHTECH PAYMENT go up and down completely randomly.

Pair Corralation between ATTIJARIWAFA BANK and HIGHTECH PAYMENT

Assuming the 90 days trading horizon ATTIJARIWAFA BANK is expected to generate 0.22 times more return on investment than HIGHTECH PAYMENT. However, ATTIJARIWAFA BANK is 4.55 times less risky than HIGHTECH PAYMENT. It trades about 0.08 of its potential returns per unit of risk. HIGHTECH PAYMENT SYSTEMS is currently generating about -0.04 per unit of risk. If you would invest  43,900  in ATTIJARIWAFA BANK on September 13, 2024 and sell it today you would earn a total of  13,430  from holding ATTIJARIWAFA BANK or generate 30.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	73.66%
Values	Daily Returns

ATTIJARIWAFA BANK  vs.  HIGHTECH PAYMENT SYSTEMS

ATTIJARIWAFA BANK

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ATTIJARIWAFA BANK are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak fundamental drivers, ATTIJARIWAFA BANK may actually be approaching a critical reversion point that can send shares even higher in January 2025.

HIGHTECH PAYMENT SYSTEMS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HIGHTECH PAYMENT SYSTEMS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, HIGHTECH PAYMENT is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with ATTIJARIWAFA BANK and HIGHTECH PAYMENT

The main advantage of trading using opposite ATTIJARIWAFA BANK and HIGHTECH PAYMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATTIJARIWAFA BANK position performs unexpectedly, HIGHTECH PAYMENT 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 HIGHTECH PAYMENT will offset losses from the drop in HIGHTECH PAYMENT's long position.

The idea behind ATTIJARIWAFA BANK and HIGHTECH PAYMENT SYSTEMS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.