Correlation Between Clal Biotechnology and Sure Tech
Can any of the company-specific risk be diversified away by investing in both Clal Biotechnology and Sure Tech 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 Clal Biotechnology and Sure Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clal Biotechnology Industries and Sure Tech Investments LP, you can compare the effects of market volatilities on Clal Biotechnology and Sure Tech 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 Clal Biotechnology with a short position of Sure Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clal Biotechnology and Sure Tech.
Diversification Opportunities for Clal Biotechnology and Sure Tech
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clal and Sure is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Clal Biotechnology Industries and Sure Tech Investments LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sure Tech Investments and Clal Biotechnology 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 Clal Biotechnology Industries are associated (or correlated) with Sure Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sure Tech Investments has no effect on the direction of Clal Biotechnology i.e., Clal Biotechnology and Sure Tech go up and down completely randomly.
Pair Corralation between Clal Biotechnology and Sure Tech
Assuming the 90 days trading horizon Clal Biotechnology Industries is expected to generate 1.53 times more return on investment than Sure Tech. However, Clal Biotechnology is 1.53 times more volatile than Sure Tech Investments LP. It trades about -0.07 of its potential returns per unit of risk. Sure Tech Investments LP is currently generating about -0.14 per unit of risk. If you would invest 3,610 in Clal Biotechnology Industries on November 3, 2024 and sell it today you would lose (110.00) from holding Clal Biotechnology Industries or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Clal Biotechnology Industries vs. Sure Tech Investments LP
Performance |
| Timeline |
| Clal Biotechnology |
| Sure Tech Investments |
Clal Biotechnology and Sure Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clal Biotechnology and Sure Tech
The main advantage of trading using opposite Clal Biotechnology and Sure Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clal Biotechnology position performs unexpectedly, Sure Tech 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 Sure Tech will offset losses from the drop in Sure Tech's long position.| Clal Biotechnology vs. Kamada | Clal Biotechnology vs. BioLine RX | Clal Biotechnology vs. Evogene | Clal Biotechnology vs. Bezeq Israeli Telecommunication |
| Sure Tech vs. Feat Fund Investments | Sure Tech vs. Abra Information Technologies | Sure Tech vs. Dan Hotels | Sure Tech vs. Azorim Investment Development |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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