Correlation Between Big Shopping and Summit
Can any of the company-specific risk be diversified away by investing in both Big Shopping and Summit 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 Big Shopping and Summit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Big Shopping Centers and Summit, you can compare the effects of market volatilities on Big Shopping and Summit 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 Big Shopping with a short position of Summit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Shopping and Summit.
Diversification Opportunities for Big Shopping and Summit
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Big and Summit is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Big Shopping Centers and Summit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit and Big Shopping 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 Big Shopping Centers are associated (or correlated) with Summit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit has no effect on the direction of Big Shopping i.e., Big Shopping and Summit go up and down completely randomly.
Pair Corralation between Big Shopping and Summit
Assuming the 90 days trading horizon Big Shopping is expected to generate 2.93 times less return on investment than Summit. But when comparing it to its historical volatility, Big Shopping Centers is 1.93 times less risky than Summit. It trades about 0.18 of its potential returns per unit of risk. Summit is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 540,600 in Summit on November 9, 2024 and sell it today you would earn a total of 71,400 from holding Summit or generate 13.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Big Shopping Centers vs. Summit
Performance |
| Timeline |
| Big Shopping Centers |
| Summit |
Big Shopping and Summit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big Shopping and Summit
The main advantage of trading using opposite Big Shopping and Summit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big Shopping position performs unexpectedly, Summit 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 Summit will offset losses from the drop in Summit's long position.| Big Shopping vs. Azrieli Group | Big Shopping vs. Melisron | Big Shopping vs. Amot Investments | Big Shopping vs. Alony Hetz Properties |
| Summit vs. Alony Hetz Properties | Summit vs. The Phoenix Holdings | Summit vs. Migdal Insurance | Summit vs. Big Shopping Centers |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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