Correlation Between Egyptians For and Commercial International
Can any of the company-specific risk be diversified away by investing in both Egyptians For and Commercial International 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 Egyptians For and Commercial International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Egyptians For Investment and Commercial International Bank Egypt, you can compare the effects of market volatilities on Egyptians For and Commercial International 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 Egyptians For with a short position of Commercial International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Egyptians For and Commercial International.
Diversification Opportunities for Egyptians For and Commercial International
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Egyptians and Commercial is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Egyptians For Investment and Commercial International Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial International and Egyptians 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 Egyptians For Investment are associated (or correlated) with Commercial International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial International has no effect on the direction of Egyptians For i.e., Egyptians For and Commercial International go up and down completely randomly.
Pair Corralation between Egyptians For and Commercial International
Assuming the 90 days trading horizon Egyptians For Investment is expected to generate 3.38 times more return on investment than Commercial International. However, Egyptians For is 3.38 times more volatile than Commercial International Bank Egypt. It trades about 0.24 of its potential returns per unit of risk. Commercial International Bank Egypt is currently generating about -0.1 per unit of risk. If you would invest 22.00 in Egyptians For Investment on August 30, 2024 and sell it today you would earn a total of 3.00 from holding Egyptians For Investment or generate 13.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Egyptians For Investment vs. Commercial International Bank
Performance |
| Timeline |
| Egyptians For Investment |
| Commercial International |
Egyptians For and Commercial International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Egyptians For and Commercial International
The main advantage of trading using opposite Egyptians For and Commercial International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Egyptians For position performs unexpectedly, Commercial International 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 Commercial International will offset losses from the drop in Commercial International's long position.| Egyptians For vs. Paint Chemicals Industries | Egyptians For vs. Misr Oils Soap | Egyptians For vs. Global Telecom Holding | Egyptians For vs. Qatar Natl Bank |
| Commercial International vs. Al Arafa Investment | Commercial International vs. Taaleem Management Services | Commercial International vs. Misr Oils Soap | Commercial International vs. Nile City 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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