Correlation Between Azrieli and Sella Real
Can any of the company-specific risk be diversified away by investing in both Azrieli and Sella Real 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 Sella Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Azrieli Group and Sella Real Estate, you can compare the effects of market volatilities on Azrieli and Sella Real 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 Sella Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azrieli and Sella Real.
Diversification Opportunities for Azrieli and Sella Real
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Azrieli and Sella is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Azrieli Group and Sella Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sella Real Estate 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 Sella Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sella Real Estate has no effect on the direction of Azrieli i.e., Azrieli and Sella Real go up and down completely randomly.
Pair Corralation between Azrieli and Sella Real
Assuming the 90 days trading horizon Azrieli is expected to generate 2.67 times less return on investment than Sella Real. In addition to that, Azrieli is 1.22 times more volatile than Sella Real Estate. It trades about 0.22 of its total potential returns per unit of risk. Sella Real Estate is currently generating about 0.72 per unit of volatility. If you would invest 73,058 in Sella Real Estate on August 25, 2024 and sell it today you would earn a total of 13,042 from holding Sella Real Estate or generate 17.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Azrieli Group vs. Sella Real Estate
Performance |
| Timeline |
| Azrieli Group |
| Sella Real Estate |
Azrieli and Sella Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Azrieli and Sella Real
The main advantage of trading using opposite Azrieli and Sella Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Azrieli position performs unexpectedly, Sella Real 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 Sella Real will offset losses from the drop in Sella Real's long position.| Azrieli vs. Israel Canada | Azrieli vs. Delek Group | Azrieli vs. Shikun Binui | Azrieli vs. Israel Discount Bank |
| Sella Real vs. Israel Canada | Sella Real vs. Azrieli Group | Sella Real vs. Delek Group | Sella Real vs. Shikun Binui |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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