Correlation Between Airport City and Elbit Systems
Can any of the company-specific risk be diversified away by investing in both Airport City and Elbit Systems 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 Airport City and Elbit Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airport City and Elbit Systems, you can compare the effects of market volatilities on Airport City and Elbit Systems 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 Airport City with a short position of Elbit Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airport City and Elbit Systems.
Diversification Opportunities for Airport City and Elbit Systems
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Airport and Elbit is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Airport City and Elbit Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elbit Systems and Airport City 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 Airport City are associated (or correlated) with Elbit Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elbit Systems has no effect on the direction of Airport City i.e., Airport City and Elbit Systems go up and down completely randomly.
Pair Corralation between Airport City and Elbit Systems
Assuming the 90 days trading horizon Airport City is expected to generate 0.74 times more return on investment than Elbit Systems. However, Airport City is 1.34 times less risky than Elbit Systems. It trades about 0.35 of its potential returns per unit of risk. Elbit Systems is currently generating about 0.25 per unit of risk. If you would invest 559,500 in Airport City on August 29, 2024 and sell it today you would earn a total of 49,500 from holding Airport City or generate 8.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airport City vs. Elbit Systems
Performance |
| Timeline |
| Airport City |
| Elbit Systems |
Airport City and Elbit Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airport City and Elbit Systems
The main advantage of trading using opposite Airport City and Elbit Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airport City position performs unexpectedly, Elbit Systems 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 Elbit Systems will offset losses from the drop in Elbit Systems' long position.| Airport City vs. Melisron | Airport City vs. Alony Hetz Properties | Airport City vs. Amot Investments | Airport City vs. Azrieli Group |
| Elbit Systems vs. Nice | Elbit Systems vs. Bank Leumi Le Israel | Elbit Systems vs. Teva Pharmaceutical Industries | Elbit Systems vs. Bank Hapoalim |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |