Correlation Between Egyptian Gulf and AJWA For
Can any of the company-specific risk be diversified away by investing in both Egyptian Gulf and AJWA For 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 Egyptian Gulf and AJWA For into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Egyptian Gulf Bank and AJWA for Food, you can compare the effects of market volatilities on Egyptian Gulf and AJWA For 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 Egyptian Gulf with a short position of AJWA For. Check out your portfolio center. Please also check ongoing floating volatility patterns of Egyptian Gulf and AJWA For.
Diversification Opportunities for Egyptian Gulf and AJWA For
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Egyptian and AJWA is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Egyptian Gulf Bank and AJWA for Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AJWA for Food and Egyptian Gulf 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 Egyptian Gulf Bank are associated (or correlated) with AJWA For. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AJWA for Food has no effect on the direction of Egyptian Gulf i.e., Egyptian Gulf and AJWA For go up and down completely randomly.
Pair Corralation between Egyptian Gulf and AJWA For
Assuming the 90 days trading horizon Egyptian Gulf Bank is expected to under-perform the AJWA For. But the stock apears to be less risky and, when comparing its historical volatility, Egyptian Gulf Bank is 2.24 times less risky than AJWA For. The stock trades about -0.07 of its potential returns per unit of risk. The AJWA for Food is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,030 in AJWA for Food on August 27, 2024 and sell it today you would earn a total of 4,782 from holding AJWA for Food or generate 235.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Egyptian Gulf Bank vs. AJWA for Food
Performance |
| Timeline |
| Egyptian Gulf Bank |
| AJWA for Food |
Egyptian Gulf and AJWA For Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Egyptian Gulf and AJWA For
The main advantage of trading using opposite Egyptian Gulf and AJWA For positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Egyptian Gulf position performs unexpectedly, AJWA For 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 AJWA For will offset losses from the drop in AJWA For's long position.| Egyptian Gulf vs. Paint Chemicals Industries | Egyptian Gulf vs. Egyptians For Investment | Egyptian Gulf vs. Misr Oils Soap | Egyptian Gulf vs. Global Telecom Holding |
| AJWA For vs. Egypt Aluminum | AJWA For vs. Egyptian Gulf Bank | AJWA For vs. Al Tawfeek Leasing | AJWA For vs. Credit Agricole Egypt |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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