Correlation Between Bezeq Israeli and Meitav Dash
Can any of the company-specific risk be diversified away by investing in both Bezeq Israeli and Meitav Dash 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 Bezeq Israeli and Meitav Dash into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bezeq Israeli Telecommunication and Meitav Dash Investments, you can compare the effects of market volatilities on Bezeq Israeli and Meitav Dash 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 Bezeq Israeli with a short position of Meitav Dash. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bezeq Israeli and Meitav Dash.
Diversification Opportunities for Bezeq Israeli and Meitav Dash
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bezeq and Meitav is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Bezeq Israeli Telecommunicatio and Meitav Dash Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meitav Dash Investments and Bezeq Israeli 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 Bezeq Israeli Telecommunication are associated (or correlated) with Meitav Dash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meitav Dash Investments has no effect on the direction of Bezeq Israeli i.e., Bezeq Israeli and Meitav Dash go up and down completely randomly.
Pair Corralation between Bezeq Israeli and Meitav Dash
Assuming the 90 days trading horizon Bezeq Israeli is expected to generate 2.16 times less return on investment than Meitav Dash. In addition to that, Bezeq Israeli is 1.02 times more volatile than Meitav Dash Investments. It trades about 0.25 of its total potential returns per unit of risk. Meitav Dash Investments is currently generating about 0.56 per unit of volatility. If you would invest 318,000 in Meitav Dash Investments on November 3, 2024 and sell it today you would earn a total of 57,000 from holding Meitav Dash Investments or generate 17.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bezeq Israeli Telecommunicatio vs. Meitav Dash Investments
Performance |
| Timeline |
| Bezeq Israeli Teleco |
| Meitav Dash Investments |
Bezeq Israeli and Meitav Dash Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bezeq Israeli and Meitav Dash
The main advantage of trading using opposite Bezeq Israeli and Meitav Dash positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bezeq Israeli position performs unexpectedly, Meitav Dash 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 Meitav Dash will offset losses from the drop in Meitav Dash's long position.| Bezeq Israeli vs. Bank Leumi Le Israel | Bezeq Israeli vs. Teva Pharmaceutical Industries | Bezeq Israeli vs. Bank Hapoalim | Bezeq Israeli vs. Elbit Systems |
| Meitav Dash vs. Priortech | Meitav Dash vs. Magic Software Enterprises | Meitav Dash vs. Retailors | Meitav Dash vs. Elron Electronic Industries |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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