Correlation Between AJWA For and B Investments
Can any of the company-specific risk be diversified away by investing in both AJWA For and B Investments 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 AJWA For and B Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AJWA for Food and B Investments Holding, you can compare the effects of market volatilities on AJWA For and B Investments 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 AJWA For with a short position of B Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of AJWA For and B Investments.
Diversification Opportunities for AJWA For and B Investments
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AJWA and BINV is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding AJWA for Food and B Investments Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on B Investments Holding and AJWA For 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 AJWA for Food are associated (or correlated) with B Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of B Investments Holding has no effect on the direction of AJWA For i.e., AJWA For and B Investments go up and down completely randomly.
Pair Corralation between AJWA For and B Investments
Assuming the 90 days trading horizon AJWA for Food is expected to generate 1.15 times more return on investment than B Investments. However, AJWA For is 1.15 times more volatile than B Investments Holding. It trades about 0.07 of its potential returns per unit of risk. B Investments Holding is currently generating about 0.03 per unit of risk. If you would invest 5,164 in AJWA for Food on August 27, 2024 and sell it today you would earn a total of 1,648 from holding AJWA for Food or generate 31.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AJWA for Food vs. B Investments Holding
Performance |
| Timeline |
| AJWA for Food |
| B Investments Holding |
AJWA For and B Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AJWA For and B Investments
The main advantage of trading using opposite AJWA For and B Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AJWA For position performs unexpectedly, B Investments 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 B Investments will offset losses from the drop in B Investments' long position.| AJWA For vs. Paint Chemicals Industries | AJWA For vs. Egyptians For Investment | AJWA For vs. Misr Oils Soap | AJWA For vs. Global Telecom Holding |
| B Investments vs. Paint Chemicals Industries | B Investments vs. Egyptians For Investment | B Investments vs. Misr Oils Soap | B Investments vs. Global Telecom Holding |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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