Correlation Between Nasdaq and Sidi Kerir

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

By analyzing existing cross correlation between Nasdaq Inc and Sidi Kerir Petrochemicals, you can compare the effects of market volatilities on Nasdaq and Sidi Kerir 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 Nasdaq with a short position of Sidi Kerir. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and Sidi Kerir.

Diversification Opportunities for Nasdaq and Sidi Kerir

-0.34

Correlation Coefficient

Nasdaq  Sidi Kerir

Very good diversification

The 3 months correlation between Nasdaq and Sidi is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and Sidi Kerir Petrochemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sidi Kerir Petrochemicals and Nasdaq 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 Nasdaq Inc are associated (or correlated) with Sidi Kerir. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sidi Kerir Petrochemicals has no effect on the direction of Nasdaq i.e., Nasdaq and Sidi Kerir go up and down completely randomly.

Pair Corralation between Nasdaq and Sidi Kerir

Given the investment horizon of 90 days Nasdaq Inc is expected to under-perform the Sidi Kerir. But the stock apears to be less risky and, when comparing its historical volatility, Nasdaq Inc is 1.57 times less risky than Sidi Kerir. The stock trades about -0.01 of its potential returns per unit of risk. The Sidi Kerir Petrochemicals is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  1,860  in Sidi Kerir Petrochemicals on December 26, 2024 and sell it today you would earn a total of  249.00  from holding Sidi Kerir Petrochemicals or generate 13.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	81.97%
Values	Daily Returns

Nasdaq Inc  vs.  Sidi Kerir Petrochemicals

Nasdaq Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nasdaq Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Nasdaq is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Sidi Kerir Petrochemicals

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sidi Kerir Petrochemicals are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Sidi Kerir reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nasdaq and Sidi Kerir

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

The idea behind Nasdaq Inc and Sidi Kerir Petrochemicals 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.