Correlation Between Analyst IMS and El Al
Can any of the company-specific risk be diversified away by investing in both Analyst IMS and El Al 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 El Al 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 El Al Israel, you can compare the effects of market volatilities on Analyst IMS and El Al 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 El Al. Check out your portfolio center. Please also check ongoing floating volatility patterns of Analyst IMS and El Al.
Diversification Opportunities for Analyst IMS and El Al
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Analyst and ELAL is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Analyst IMS Investment and El Al Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on El Al Israel 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 El Al. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of El Al Israel has no effect on the direction of Analyst IMS i.e., Analyst IMS and El Al go up and down completely randomly.
Pair Corralation between Analyst IMS and El Al
Assuming the 90 days trading horizon Analyst IMS is expected to generate 1.86 times less return on investment than El Al. But when comparing it to its historical volatility, Analyst IMS Investment is 2.14 times less risky than El Al. It trades about 0.1 of its potential returns per unit of risk. El Al Israel is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 26,622 in El Al Israel on September 13, 2024 and sell it today you would earn a total of 41,578 from holding El Al Israel or generate 156.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Analyst IMS Investment vs. El Al Israel
Performance |
| Timeline |
| Analyst IMS Investment |
| El Al Israel |
Analyst IMS and El Al Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Analyst IMS and El Al
The main advantage of trading using opposite Analyst IMS and El Al positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Analyst IMS position performs unexpectedly, El Al 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 El Al will offset losses from the drop in El Al's long position.| Analyst IMS vs. Bank Hapoalim | Analyst IMS vs. Israel Discount Bank | Analyst IMS vs. Mizrahi Tefahot | Analyst IMS vs. Bezeq Israeli Telecommunication |
| El Al vs. Aran Research and | El Al vs. Al Bad Massuot Yitzhak | El Al vs. Analyst IMS Investment | El Al vs. Golan Plastic |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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