Correlation Between Cairo Communication and T Mobile

Can any of the company-specific risk be diversified away by investing in both Cairo Communication and T Mobile 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 Cairo Communication and T Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cairo Communication SpA and T Mobile, you can compare the effects of market volatilities on Cairo Communication and T Mobile 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 Cairo Communication with a short position of T Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cairo Communication and T Mobile.

Diversification Opportunities for Cairo Communication and T Mobile

0.13

Correlation Coefficient

Cairo Communication  T Mobile

Average diversification

The 3 months correlation between Cairo and 0R2L is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cairo Communication SpA and T Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T Mobile and Cairo Communication 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 Cairo Communication SpA are associated (or correlated) with T Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T Mobile has no effect on the direction of Cairo Communication i.e., Cairo Communication and T Mobile go up and down completely randomly.

Pair Corralation between Cairo Communication and T Mobile

Assuming the 90 days trading horizon Cairo Communication SpA is expected to under-perform the T Mobile. In addition to that, Cairo Communication is 1.2 times more volatile than T Mobile. It trades about -0.02 of its total potential returns per unit of risk. T Mobile is currently generating about 0.0 per unit of volatility. If you would invest  23,200  in T Mobile on April 25, 2025 and sell it today you would lose (47.00) from holding T Mobile or give up 0.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Cairo Communication SpA  vs.  T Mobile

Cairo Communication SpA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cairo Communication SpA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cairo Communication is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

T Mobile

Risk-Adjusted Performance

Very Weak

Over the last 90 days T Mobile has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, T Mobile is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Cairo Communication and T Mobile

The main advantage of trading using opposite Cairo Communication and T Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cairo Communication position performs unexpectedly, T Mobile 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 T Mobile will offset losses from the drop in T Mobile's long position.

The idea behind Cairo Communication SpA and T Mobile 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.