Correlation Between Cisco Systems and MAROC TELECOM

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

By analyzing existing cross correlation between Cisco Systems and MAROC TELECOM, you can compare the effects of market volatilities on Cisco Systems and MAROC TELECOM 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 Cisco Systems with a short position of MAROC TELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and MAROC TELECOM.

Diversification Opportunities for Cisco Systems and MAROC TELECOM

0.72

Correlation Coefficient

Cisco Systems  MAROC TELECOM

Poor diversification

The 3 months correlation between Cisco and MAROC is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and MAROC TELECOM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAROC TELECOM and Cisco Systems 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 Cisco Systems are associated (or correlated) with MAROC TELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAROC TELECOM has no effect on the direction of Cisco Systems i.e., Cisco Systems and MAROC TELECOM go up and down completely randomly.

Pair Corralation between Cisco Systems and MAROC TELECOM

Assuming the 90 days horizon Cisco Systems is expected to generate 6.13 times less return on investment than MAROC TELECOM. In addition to that, Cisco Systems is 1.28 times more volatile than MAROC TELECOM. It trades about 0.02 of its total potential returns per unit of risk. MAROC TELECOM is currently generating about 0.18 per unit of volatility. If you would invest  965.00  in MAROC TELECOM on May 20, 2025 and sell it today you would earn a total of  125.00  from holding MAROC TELECOM or generate 12.95% return on investment over 90 days.

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

Cisco Systems  vs.  MAROC TELECOM

Cisco Systems

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cisco Systems are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Cisco Systems is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

MAROC TELECOM

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MAROC TELECOM are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, MAROC TELECOM may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Cisco Systems and MAROC TELECOM

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

The idea behind Cisco Systems and MAROC TELECOM 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.