Correlation Between Cairo For and El Kahera
Can any of the company-specific risk be diversified away by investing in both Cairo For and El Kahera 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 For and El Kahera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cairo For Investment and El Kahera El, you can compare the effects of market volatilities on Cairo For and El Kahera 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 For with a short position of El Kahera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cairo For and El Kahera.
Diversification Opportunities for Cairo For and El Kahera
Significant diversification
The 3 months correlation between Cairo and KWIN is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Cairo For Investment and El Kahera El in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on El Kahera El and Cairo 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 Cairo For Investment are associated (or correlated) with El Kahera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of El Kahera El has no effect on the direction of Cairo For i.e., Cairo For and El Kahera go up and down completely randomly.
Pair Corralation between Cairo For and El Kahera
Assuming the 90 days trading horizon Cairo For Investment is expected to generate 0.3 times more return on investment than El Kahera. However, Cairo For Investment is 3.3 times less risky than El Kahera. It trades about -0.19 of its potential returns per unit of risk. El Kahera El is currently generating about -0.09 per unit of risk. If you would invest 1,460 in Cairo For Investment on September 2, 2024 and sell it today you would lose (40.00) from holding Cairo For Investment or give up 2.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cairo For Investment vs. El Kahera El
Performance |
| Timeline |
| Cairo For Investment |
| El Kahera El |
Cairo For and El Kahera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cairo For and El Kahera
The main advantage of trading using opposite Cairo For and El Kahera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cairo For position performs unexpectedly, El Kahera 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 El Kahera will offset losses from the drop in El Kahera's long position.| Cairo For vs. Egyptians For Investment | Cairo For vs. Misr Oils Soap | Cairo For vs. Global Telecom Holding | Cairo For vs. Qatar Natl Bank |
| El Kahera vs. Mohandes Insurance | El Kahera vs. El Ahli Investment | El Kahera vs. Telecom Egypt | El Kahera vs. Cairo For 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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