Correlation Between Airport City and Shikun Binui
Can any of the company-specific risk be diversified away by investing in both Airport City and Shikun Binui 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 Shikun Binui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airport City and Shikun Binui, you can compare the effects of market volatilities on Airport City and Shikun Binui 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 Shikun Binui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airport City and Shikun Binui.
Diversification Opportunities for Airport City and Shikun Binui
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Airport and Shikun is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Airport City and Shikun Binui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shikun Binui 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 Shikun Binui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shikun Binui has no effect on the direction of Airport City i.e., Airport City and Shikun Binui go up and down completely randomly.
Pair Corralation between Airport City and Shikun Binui
Assuming the 90 days trading horizon Airport City is expected to generate 2.16 times less return on investment than Shikun Binui. But when comparing it to its historical volatility, Airport City is 1.5 times less risky than Shikun Binui. It trades about 0.04 of its potential returns per unit of risk. Shikun Binui is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 82,510 in Shikun Binui on August 31, 2024 and sell it today you would earn a total of 36,290 from holding Shikun Binui or generate 43.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.66% |
| Values | Daily Returns |
Airport City vs. Shikun Binui
Performance |
| Timeline |
| Airport City |
| Shikun Binui |
Airport City and Shikun Binui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airport City and Shikun Binui
The main advantage of trading using opposite Airport City and Shikun Binui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airport City position performs unexpectedly, Shikun Binui 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 Shikun Binui will offset losses from the drop in Shikun Binui's long position.| Airport City vs. Melisron | Airport City vs. Alony Hetz Properties | Airport City vs. Amot Investments | Airport City vs. Azrieli Group |
| Shikun Binui vs. Arad | Shikun Binui vs. Alony Hetz Properties | Shikun Binui vs. Airport City | Shikun Binui vs. Harel Insurance Investments |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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