Correlation Between Assiut Islamic and Ezz Steel

Can any of the company-specific risk be diversified away by investing in both Assiut Islamic and Ezz Steel 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 Assiut Islamic and Ezz Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Assiut Islamic Trading and Ezz Steel, you can compare the effects of market volatilities on Assiut Islamic and Ezz Steel 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 Assiut Islamic with a short position of Ezz Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assiut Islamic and Ezz Steel.

Diversification Opportunities for Assiut Islamic and Ezz Steel

0.0

Correlation Coefficient

Assiut Islamic  Ezz Steel

Pay attention - limited upside

The 3 months correlation between Assiut and Ezz is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Assiut Islamic Trading and Ezz Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ezz Steel and Assiut Islamic 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 Assiut Islamic Trading are associated (or correlated) with Ezz Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ezz Steel has no effect on the direction of Assiut Islamic i.e., Assiut Islamic and Ezz Steel go up and down completely randomly.

Pair Corralation between Assiut Islamic and Ezz Steel

If you would invest  11,248  in Ezz Steel on December 29, 2024 and sell it today you would earn a total of  2,142  from holding Ezz Steel or generate 19.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Assiut Islamic Trading  vs.  Ezz Steel

Assiut Islamic Trading

Risk-Adjusted Performance

Very Weak

Over the last 90 days Assiut Islamic Trading has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Assiut Islamic is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Ezz Steel

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ezz Steel are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Ezz Steel reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Assiut Islamic and Ezz Steel

The main advantage of trading using opposite Assiut Islamic and Ezz Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assiut Islamic position performs unexpectedly, Ezz Steel 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 Ezz Steel will offset losses from the drop in Ezz Steel's long position.

The idea behind Assiut Islamic Trading and Ezz Steel pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.