Correlation Between Ashot Ashkelon and PCB Tec
Can any of the company-specific risk be diversified away by investing in both Ashot Ashkelon and PCB Tec 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 Ashot Ashkelon and PCB Tec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashot Ashkelon Industries and PCB Tec, you can compare the effects of market volatilities on Ashot Ashkelon and PCB Tec 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 Ashot Ashkelon with a short position of PCB Tec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashot Ashkelon and PCB Tec.
Diversification Opportunities for Ashot Ashkelon and PCB Tec
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ashot and PCB is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Ashot Ashkelon Industries and PCB Tec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCB Tec and Ashot Ashkelon 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 Ashot Ashkelon Industries are associated (or correlated) with PCB Tec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCB Tec has no effect on the direction of Ashot Ashkelon i.e., Ashot Ashkelon and PCB Tec go up and down completely randomly.
Pair Corralation between Ashot Ashkelon and PCB Tec
Assuming the 90 days trading horizon Ashot Ashkelon Industries is expected to generate 0.82 times more return on investment than PCB Tec. However, Ashot Ashkelon Industries is 1.23 times less risky than PCB Tec. It trades about 0.13 of its potential returns per unit of risk. PCB Tec is currently generating about 0.1 per unit of risk. If you would invest 134,553 in Ashot Ashkelon Industries on September 1, 2024 and sell it today you would earn a total of 298,447 from holding Ashot Ashkelon Industries or generate 221.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashot Ashkelon Industries vs. PCB Tec
Performance |
| Timeline |
| Ashot Ashkelon Industries |
| PCB Tec |
Ashot Ashkelon and PCB Tec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashot Ashkelon and PCB Tec
The main advantage of trading using opposite Ashot Ashkelon and PCB Tec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashot Ashkelon position performs unexpectedly, PCB Tec 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 PCB Tec will offset losses from the drop in PCB Tec's long position.| Ashot Ashkelon vs. Bet Shemesh Engines | Ashot Ashkelon vs. Elbit Systems | Ashot Ashkelon vs. Bezeq Israeli Telecommunication | Ashot Ashkelon vs. Rekah Pharmaceutical Industry |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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