Similar to other emerging economies, the Egyptian stock market has recently experienced a remarkable run-up but also a major downturn. This paper analyzes the stock market from two angles. First, it compares the performance of the major stock price index with its underlying fundamentals. Second, it explores the relationship between the Egyptian and other stock markets. The paper finds that (i) there is some evidence against a stable relationship between the Egyptian index and its fundamental value; and (ii) short-term correlations and long-term cointegrating relations provide conflicting signals on the value of Egyptian stocks as a means of diversification.almost 12 times as high as at the low point in March 2003ain less than three years!3 While these returns are certainly attractive, the Egyptian stock market has also garnered attention as an uncorrelated risk; that is, as a means to diversify riskanbsp;...
|Title||:||Go Long Or Short in Pyramids? News from the Egyptian Stock Market|
|Author||:||Andreas Billmeier, Isabella Massa|
|Publisher||:||International Monetary Fund - 2007-07-01|