Correlation Between Analyst IMS and Generation Capital
Can any of the company-specific risk be diversified away by investing in both Analyst IMS and Generation Capital 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 Generation Capital 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 Generation Capital, you can compare the effects of market volatilities on Analyst IMS and Generation Capital 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 Generation Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Analyst IMS and Generation Capital.
Diversification Opportunities for Analyst IMS and Generation Capital
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Analyst and Generation is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Analyst IMS Investment and Generation Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Generation Capital 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 Generation Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Generation Capital has no effect on the direction of Analyst IMS i.e., Analyst IMS and Generation Capital go up and down completely randomly.
Pair Corralation between Analyst IMS and Generation Capital
Assuming the 90 days trading horizon Analyst IMS Investment is expected to generate 0.74 times more return on investment than Generation Capital. However, Analyst IMS Investment is 1.35 times less risky than Generation Capital. It trades about 0.29 of its potential returns per unit of risk. Generation Capital is currently generating about 0.2 per unit of risk. If you would invest 371,900 in Analyst IMS Investment on August 29, 2024 and sell it today you would earn a total of 74,100 from holding Analyst IMS Investment or generate 19.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Analyst IMS Investment vs. Generation Capital
Performance |
| Timeline |
| Analyst IMS Investment |
| Generation Capital |
Analyst IMS and Generation Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Analyst IMS and Generation Capital
The main advantage of trading using opposite Analyst IMS and Generation Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Analyst IMS position performs unexpectedly, Generation Capital 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 Generation Capital will offset losses from the drop in Generation Capital's long position.| Analyst IMS vs. Elbit Systems | Analyst IMS vs. Discount Investment Corp | Analyst IMS vs. Clal Insurance Enterprises | Analyst IMS vs. AudioCodes |
| Generation Capital vs. EN Shoham Business | Generation Capital vs. Mivtach Shamir | Generation Capital vs. Enlight Renewable Energy | Generation Capital vs. Rani Zim Shopping |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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