Correlation Between Bet Shemesh and PCB Tec
Can any of the company-specific risk be diversified away by investing in both Bet Shemesh 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 Bet Shemesh and PCB Tec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bet Shemesh Engines and PCB Tec, you can compare the effects of market volatilities on Bet Shemesh 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 Bet Shemesh with a short position of PCB Tec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bet Shemesh and PCB Tec.
Diversification Opportunities for Bet Shemesh and PCB Tec
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bet and PCB is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Bet Shemesh Engines and PCB Tec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCB Tec and Bet Shemesh 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 Bet Shemesh Engines 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 Bet Shemesh i.e., Bet Shemesh and PCB Tec go up and down completely randomly.
Pair Corralation between Bet Shemesh and PCB Tec
Assuming the 90 days trading horizon Bet Shemesh Engines is expected to generate 0.89 times more return on investment than PCB Tec. However, Bet Shemesh Engines is 1.12 times less risky than PCB Tec. It trades about -0.03 of its potential returns per unit of risk. PCB Tec is currently generating about -0.08 per unit of risk. If you would invest 2,959,000 in Bet Shemesh Engines on September 1, 2024 and sell it today you would lose (102,000) from holding Bet Shemesh Engines or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bet Shemesh Engines vs. PCB Tec
Performance |
| Timeline |
| Bet Shemesh Engines |
| PCB Tec |
Bet Shemesh and PCB Tec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bet Shemesh and PCB Tec
The main advantage of trading using opposite Bet Shemesh and PCB Tec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bet Shemesh 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.| Bet Shemesh vs. Arad | Bet Shemesh vs. Alony Hetz Properties | Bet Shemesh vs. Airport City | Bet Shemesh vs. Harel Insurance Investments |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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