Correlation Between Juhayna Food and Golden Textiles
Can any of the company-specific risk be diversified away by investing in both Juhayna Food and Golden Textiles 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 Juhayna Food and Golden Textiles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juhayna Food Industries and Golden Textiles Clothes, you can compare the effects of market volatilities on Juhayna Food and Golden Textiles 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 Juhayna Food with a short position of Golden Textiles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juhayna Food and Golden Textiles.
Diversification Opportunities for Juhayna Food and Golden Textiles
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Juhayna and Golden is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Juhayna Food Industries and Golden Textiles Clothes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Textiles Clothes and Juhayna Food 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 Juhayna Food Industries are associated (or correlated) with Golden Textiles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Textiles Clothes has no effect on the direction of Juhayna Food i.e., Juhayna Food and Golden Textiles go up and down completely randomly.
Pair Corralation between Juhayna Food and Golden Textiles
Assuming the 90 days trading horizon Juhayna Food Industries is expected to generate 1.72 times more return on investment than Golden Textiles. However, Juhayna Food is 1.72 times more volatile than Golden Textiles Clothes. It trades about 0.04 of its potential returns per unit of risk. Golden Textiles Clothes is currently generating about 0.05 per unit of risk. If you would invest 3,165 in Juhayna Food Industries on September 2, 2024 and sell it today you would earn a total of 36.00 from holding Juhayna Food Industries or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juhayna Food Industries vs. Golden Textiles Clothes
Performance |
| Timeline |
| Juhayna Food Industries |
| Golden Textiles Clothes |
Juhayna Food and Golden Textiles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juhayna Food and Golden Textiles
The main advantage of trading using opposite Juhayna Food and Golden Textiles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juhayna Food position performs unexpectedly, Golden Textiles 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 Golden Textiles will offset losses from the drop in Golden Textiles' long position.| Juhayna Food vs. Telecom Egypt | Juhayna Food vs. Misr Oils Soap | Juhayna Food vs. El Nasr Clothes | Juhayna Food vs. Sidi Kerir Petrochemicals |
| Golden Textiles vs. Egyptians For Investment | Golden Textiles vs. Misr Oils Soap | Golden Textiles vs. Global Telecom Holding | Golden Textiles vs. Qatar Natl Bank |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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