Correlation Between HIGHTECH PAYMENT and ATTIJARIWAFA BANK

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

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

Diversification Opportunities for HIGHTECH PAYMENT and ATTIJARIWAFA BANK

-0.67

Correlation Coefficient

HIGHTECH PAYMENT  ATTIJARIWAFA BANK

Excellent diversification

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

Pair Corralation between HIGHTECH PAYMENT and ATTIJARIWAFA BANK

Assuming the 90 days trading horizon HIGHTECH PAYMENT SYSTEMS is expected to under-perform the ATTIJARIWAFA BANK. But the stock apears to be less risky and, when comparing its historical volatility, HIGHTECH PAYMENT SYSTEMS is 1.0 times less risky than ATTIJARIWAFA BANK. The stock trades about -0.03 of its potential returns per unit of risk. The ATTIJARIWAFA BANK is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  54,020  in ATTIJARIWAFA BANK on September 14, 2024 and sell it today you would earn a total of  3,180  from holding ATTIJARIWAFA BANK or generate 5.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

HIGHTECH PAYMENT SYSTEMS  vs.  ATTIJARIWAFA BANK

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.

ATTIJARIWAFA BANK

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ATTIJARIWAFA BANK are ranked lower than 5 (%) 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.

Pair Trading with HIGHTECH PAYMENT and ATTIJARIWAFA BANK

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

The idea behind HIGHTECH PAYMENT SYSTEMS and ATTIJARIWAFA BANK 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.