Correlation Between National Bank and Commercial International

Can any of the company-specific risk be diversified away by investing in both National Bank and Commercial International 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 National Bank and Commercial International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between National Bank and Commercial International Bank Egypt, you can compare the effects of market volatilities on National Bank and Commercial International 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 National Bank with a short position of Commercial International. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Commercial International.

Diversification Opportunities for National Bank and Commercial International

0.0

Correlation Coefficient

National Bank  Commercial International

Pay attention - limited upside

The 3 months correlation between National and Commercial is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank and Commercial International Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial International and National 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 National Bank are associated (or correlated) with Commercial International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial International has no effect on the direction of National Bank i.e., National Bank and Commercial International go up and down completely randomly.

Pair Corralation between National Bank and Commercial International

If you would invest  1,300  in National Bank on December 4, 2024 and sell it today you would earn a total of  0.00  from holding National Bank or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.0%
Values	Daily Returns

National Bank  vs.  Commercial International Bank

National Bank

Risk-Adjusted Performance

Very Weak

Over the last 90 days National Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, National Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Commercial International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Commercial International Bank Egypt has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with National Bank and Commercial International

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

The idea behind National Bank and Commercial International Bank Egypt 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.

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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.