Correlation Between Azrieli and Dan Hotels
Can any of the company-specific risk be diversified away by investing in both Azrieli and Dan Hotels 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 Azrieli and Dan Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Azrieli Group and Dan Hotels, you can compare the effects of market volatilities on Azrieli and Dan Hotels 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 Azrieli with a short position of Dan Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azrieli and Dan Hotels.
Diversification Opportunities for Azrieli and Dan Hotels
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Azrieli and Dan is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Azrieli Group and Dan Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dan Hotels and Azrieli 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 Azrieli Group are associated (or correlated) with Dan Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dan Hotels has no effect on the direction of Azrieli i.e., Azrieli and Dan Hotels go up and down completely randomly.
Pair Corralation between Azrieli and Dan Hotels
Assuming the 90 days trading horizon Azrieli Group is expected to generate 0.89 times more return on investment than Dan Hotels. However, Azrieli Group is 1.12 times less risky than Dan Hotels. It trades about 0.04 of its potential returns per unit of risk. Dan Hotels is currently generating about 0.0 per unit of risk. If you would invest 2,262,755 in Azrieli Group on August 27, 2024 and sell it today you would earn a total of 587,245 from holding Azrieli Group or generate 25.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Azrieli Group vs. Dan Hotels
Performance |
| Timeline |
| Azrieli Group |
| Dan Hotels |
Azrieli and Dan Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Azrieli and Dan Hotels
The main advantage of trading using opposite Azrieli and Dan Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Azrieli position performs unexpectedly, Dan Hotels 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 Dan Hotels will offset losses from the drop in Dan Hotels' long position.| Azrieli vs. Israel Canada | Azrieli vs. Delek Group | Azrieli vs. Shikun Binui | Azrieli vs. Israel Discount Bank |
| Dan Hotels vs. Wesure Global Tech | Dan Hotels vs. ICL Israel Chemicals | Dan Hotels vs. Payment Financial Technologies | Dan Hotels vs. Millennium Food Tech LP |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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