Correlation Between Grand Investment and Ismailia National

Can any of the company-specific risk be diversified away by investing in both Grand Investment and Ismailia National 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 Grand Investment and Ismailia National into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Grand Investment Capital and Ismailia National Food, you can compare the effects of market volatilities on Grand Investment and Ismailia National 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 Grand Investment with a short position of Ismailia National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Investment and Ismailia National.

Diversification Opportunities for Grand Investment and Ismailia National

-0.02

Correlation Coefficient

Grand Investment  Ismailia National

Good diversification

The 3 months correlation between Grand and Ismailia is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Grand Investment Capital and Ismailia National Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ismailia National Food and Grand Investment 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 Grand Investment Capital are associated (or correlated) with Ismailia National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ismailia National Food has no effect on the direction of Grand Investment i.e., Grand Investment and Ismailia National go up and down completely randomly.

Pair Corralation between Grand Investment and Ismailia National

Assuming the 90 days trading horizon Grand Investment Capital is expected to generate 0.91 times more return on investment than Ismailia National. However, Grand Investment Capital is 1.09 times less risky than Ismailia National. It trades about 0.09 of its potential returns per unit of risk. Ismailia National Food is currently generating about 0.07 per unit of risk. If you would invest  926.00  in Grand Investment Capital on October 7, 2024 and sell it today you would earn a total of  121.00  from holding Grand Investment Capital or generate 13.07% return on investment over 90 days.

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

Grand Investment Capital  vs.  Ismailia National Food

Grand Investment Capital

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Grand Investment Capital are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Grand Investment reported solid returns over the last few months and may actually be approaching a breakup point.

Ismailia National Food

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ismailia National Food are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Ismailia National reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Grand Investment and Ismailia National

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

The idea behind Grand Investment Capital and Ismailia National Food 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.