Correlation Between Saudi Egyptian and Cleopatra Hospital

Can any of the company-specific risk be diversified away by investing in both Saudi Egyptian and Cleopatra Hospital 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 Saudi Egyptian and Cleopatra Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Saudi Egyptian Investment and Cleopatra Hospital, you can compare the effects of market volatilities on Saudi Egyptian and Cleopatra Hospital 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 Saudi Egyptian with a short position of Cleopatra Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saudi Egyptian and Cleopatra Hospital.

Diversification Opportunities for Saudi Egyptian and Cleopatra Hospital

-0.31

Correlation Coefficient

Saudi Egyptian  Cleopatra Hospital

Very good diversification

The 3 months correlation between Saudi and Cleopatra is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Saudi Egyptian Investment and Cleopatra Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cleopatra Hospital and Saudi Egyptian 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 Saudi Egyptian Investment are associated (or correlated) with Cleopatra Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cleopatra Hospital has no effect on the direction of Saudi Egyptian i.e., Saudi Egyptian and Cleopatra Hospital go up and down completely randomly.

Pair Corralation between Saudi Egyptian and Cleopatra Hospital

Assuming the 90 days trading horizon Saudi Egyptian is expected to generate 5.01 times less return on investment than Cleopatra Hospital. In addition to that, Saudi Egyptian is 2.76 times more volatile than Cleopatra Hospital. It trades about 0.01 of its total potential returns per unit of risk. Cleopatra Hospital is currently generating about 0.12 per unit of volatility. If you would invest  794.00  in Cleopatra Hospital on December 25, 2024 and sell it today you would earn a total of  76.00  from holding Cleopatra Hospital or generate 9.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.0%
Values	Daily Returns

Saudi Egyptian Investment  vs.  Cleopatra Hospital

Saudi Egyptian Investment

Risk-Adjusted Performance

Very Weak

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

Cleopatra Hospital

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cleopatra Hospital are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Cleopatra Hospital may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Saudi Egyptian and Cleopatra Hospital

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

The idea behind Saudi Egyptian Investment and Cleopatra Hospital 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.

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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.