Correlation Between Analyst IMS and Salomon A
Can any of the company-specific risk be diversified away by investing in both Analyst IMS and Salomon A 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 Analyst IMS and Salomon A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Analyst IMS Investment and Salomon A Angel, you can compare the effects of market volatilities on Analyst IMS and Salomon A 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 Analyst IMS with a short position of Salomon A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Analyst IMS and Salomon A.
Diversification Opportunities for Analyst IMS and Salomon A
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Analyst and Salomon is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Analyst IMS Investment and Salomon A Angel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salomon A Angel and Analyst IMS 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 Analyst IMS Investment are associated (or correlated) with Salomon A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salomon A Angel has no effect on the direction of Analyst IMS i.e., Analyst IMS and Salomon A go up and down completely randomly.
Pair Corralation between Analyst IMS and Salomon A
Assuming the 90 days trading horizon Analyst IMS Investment is expected to generate 0.38 times more return on investment than Salomon A. However, Analyst IMS Investment is 2.63 times less risky than Salomon A. It trades about 0.3 of its potential returns per unit of risk. Salomon A Angel is currently generating about 0.01 per unit of risk. If you would invest 382,500 in Analyst IMS Investment on September 3, 2024 and sell it today you would earn a total of 77,700 from holding Analyst IMS Investment or generate 20.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Analyst IMS Investment vs. Salomon A Angel
Performance |
| Timeline |
| Analyst IMS Investment |
| Salomon A Angel |
Analyst IMS and Salomon A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Analyst IMS and Salomon A
The main advantage of trading using opposite Analyst IMS and Salomon A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Analyst IMS position performs unexpectedly, Salomon A 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 Salomon A will offset losses from the drop in Salomon A's long position.| Analyst IMS vs. Bank Hapoalim | Analyst IMS vs. Israel Discount Bank | Analyst IMS vs. First International Bank | Analyst IMS vs. Elbit Systems |
| Salomon A vs. Zanlakol | Salomon A vs. Gan Shmuel | Salomon A vs. Carmit | Salomon A vs. Sano Brunos Enterprises |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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