Correlation Between Agha Steel and Bank Makramah
Can any of the company-specific risk be diversified away by investing in both Agha Steel and Bank Makramah 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 Agha Steel and Bank Makramah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agha Steel Industries and Bank Makramah, you can compare the effects of market volatilities on Agha Steel and Bank Makramah 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 Agha Steel with a short position of Bank Makramah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agha Steel and Bank Makramah.
Diversification Opportunities for Agha Steel and Bank Makramah
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Agha and Bank is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Agha Steel Industries and Bank Makramah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Makramah and Agha Steel 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 Agha Steel Industries are associated (or correlated) with Bank Makramah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Makramah has no effect on the direction of Agha Steel i.e., Agha Steel and Bank Makramah go up and down completely randomly.
Pair Corralation between Agha Steel and Bank Makramah
Assuming the 90 days trading horizon Agha Steel is expected to generate 8.13 times less return on investment than Bank Makramah. In addition to that, Agha Steel is 1.02 times more volatile than Bank Makramah. It trades about 0.0 of its total potential returns per unit of risk. Bank Makramah is currently generating about 0.01 per unit of volatility. If you would invest 219.00 in Bank Makramah on August 27, 2024 and sell it today you would lose (7.00) from holding Bank Makramah or give up 3.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 64.23% |
| Values | Daily Returns |
Agha Steel Industries vs. Bank Makramah
Performance |
| Timeline |
| Agha Steel Industries |
| Bank Makramah |
Agha Steel and Bank Makramah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agha Steel and Bank Makramah
The main advantage of trading using opposite Agha Steel and Bank Makramah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agha Steel position performs unexpectedly, Bank Makramah 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 Bank Makramah will offset losses from the drop in Bank Makramah's long position.| Agha Steel vs. Habib Insurance | Agha Steel vs. Century Insurance | Agha Steel vs. Reliance Weaving Mills | Agha Steel vs. Media Times |
| Bank Makramah vs. TPL Insurance | Bank Makramah vs. Aisha Steel Mills | Bank Makramah vs. Century Insurance | Bank Makramah vs. Agha Steel Industries |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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