Correlation Between Cairo Communication and Bankers Investment
Can any of the company-specific risk be diversified away by investing in both Cairo Communication and Bankers Investment 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 Cairo Communication and Bankers Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cairo Communication SpA and Bankers Investment Trust, you can compare the effects of market volatilities on Cairo Communication and Bankers Investment 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 Cairo Communication with a short position of Bankers Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cairo Communication and Bankers Investment.
Diversification Opportunities for Cairo Communication and Bankers Investment
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cairo and Bankers is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Cairo Communication SpA and Bankers Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankers Investment Trust and Cairo Communication 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 Cairo Communication SpA are associated (or correlated) with Bankers Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bankers Investment Trust has no effect on the direction of Cairo Communication i.e., Cairo Communication and Bankers Investment go up and down completely randomly.
Pair Corralation between Cairo Communication and Bankers Investment
Assuming the 90 days trading horizon Cairo Communication SpA is expected to generate 0.96 times more return on investment than Bankers Investment. However, Cairo Communication SpA is 1.04 times less risky than Bankers Investment. It trades about 0.27 of its potential returns per unit of risk. Bankers Investment Trust is currently generating about 0.26 per unit of risk. If you would invest 244.00 in Cairo Communication SpA on November 7, 2024 and sell it today you would earn a total of 15.00 from holding Cairo Communication SpA or generate 6.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cairo Communication SpA vs. Bankers Investment Trust
Performance |
| Timeline |
| Cairo Communication SpA |
| Bankers Investment Trust |
Cairo Communication and Bankers Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cairo Communication and Bankers Investment
The main advantage of trading using opposite Cairo Communication and Bankers Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cairo Communication position performs unexpectedly, Bankers Investment 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 Bankers Investment will offset losses from the drop in Bankers Investment's long position.| Cairo Communication vs. Host Hotels Resorts | Cairo Communication vs. Fonix Mobile plc | Cairo Communication vs. Universal Display Corp | Cairo Communication vs. Geely Automobile Holdings |
| Bankers Investment vs. Gamma Communications PLC | Bankers Investment vs. Zoom Video Communications | Bankers Investment vs. Litigation Capital Management | Bankers Investment vs. Aeorema Communications Plc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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