Correlation Between Airport City and Knafaim
Can any of the company-specific risk be diversified away by investing in both Airport City and Knafaim 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 Knafaim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airport City and Knafaim, you can compare the effects of market volatilities on Airport City and Knafaim 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 Knafaim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airport City and Knafaim.
Diversification Opportunities for Airport City and Knafaim
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Airport and Knafaim is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Airport City and Knafaim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knafaim 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 Knafaim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knafaim has no effect on the direction of Airport City i.e., Airport City and Knafaim go up and down completely randomly.
Pair Corralation between Airport City and Knafaim
Assuming the 90 days trading horizon Airport City is expected to generate 1.07 times more return on investment than Knafaim. However, Airport City is 1.07 times more volatile than Knafaim. It trades about 0.35 of its potential returns per unit of risk. Knafaim is currently generating about 0.03 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airport City vs. Knafaim
Performance |
| Timeline |
| Airport City |
| Knafaim |
Airport City and Knafaim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airport City and Knafaim
The main advantage of trading using opposite Airport City and Knafaim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airport City position performs unexpectedly, Knafaim 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 Knafaim will offset losses from the drop in Knafaim's long position.| Airport City vs. Melisron | Airport City vs. Alony Hetz Properties | Airport City vs. Amot Investments | Airport City vs. Azrieli Group |
| Knafaim vs. El Al Israel | Knafaim vs. Melisron | Knafaim vs. Global Knafaim Leasing | Knafaim vs. Bezeq Israeli Telecommunication |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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