Correlation Between Amot Investments and Isras Investment
Can any of the company-specific risk be diversified away by investing in both Amot Investments and Isras Investment 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 Amot Investments and Isras Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amot Investments and Isras Investment, you can compare the effects of market volatilities on Amot Investments and Isras Investment 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 Amot Investments with a short position of Isras Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amot Investments and Isras Investment.
Diversification Opportunities for Amot Investments and Isras Investment
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amot and Isras is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Amot Investments and Isras Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Isras Investment and Amot Investments 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 Amot Investments are associated (or correlated) with Isras Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Isras Investment has no effect on the direction of Amot Investments i.e., Amot Investments and Isras Investment go up and down completely randomly.
Pair Corralation between Amot Investments and Isras Investment
Assuming the 90 days trading horizon Amot Investments is expected to generate 1.0 times more return on investment than Isras Investment. However, Amot Investments is 1.0 times less risky than Isras Investment. It trades about 0.06 of its potential returns per unit of risk. Isras Investment is currently generating about -0.1 per unit of risk. If you would invest 206,500 in Amot Investments on November 3, 2024 and sell it today you would earn a total of 3,100 from holding Amot Investments or generate 1.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amot Investments vs. Isras Investment
Performance |
| Timeline |
| Amot Investments |
| Isras Investment |
Amot Investments and Isras Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amot Investments and Isras Investment
The main advantage of trading using opposite Amot Investments and Isras Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amot Investments position performs unexpectedly, Isras Investment 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 Isras Investment will offset losses from the drop in Isras Investment's long position.| Amot Investments vs. Alony Hetz Properties | Amot Investments vs. Azrieli Group | Amot Investments vs. Melisron | Amot Investments vs. Bank Leumi Le Israel |
| Isras Investment vs. Alony Hetz Properties | Isras Investment vs. Fox Wizel | Isras Investment vs. Amot Investments | Isras Investment vs. Harel Insurance Investments |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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