Correlation Between Cellcom Israel and Liberty Media
Can any of the company-specific risk be diversified away by investing in both Cellcom Israel and Liberty Media 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 Cellcom Israel and Liberty Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cellcom Israel and Liberty Media, you can compare the effects of market volatilities on Cellcom Israel and Liberty Media 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 Cellcom Israel with a short position of Liberty Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cellcom Israel and Liberty Media.
Diversification Opportunities for Cellcom Israel and Liberty Media
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cellcom and Liberty is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Cellcom Israel and Liberty Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Media and Cellcom Israel 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 Cellcom Israel are associated (or correlated) with Liberty Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Media has no effect on the direction of Cellcom Israel i.e., Cellcom Israel and Liberty Media go up and down completely randomly.
Pair Corralation between Cellcom Israel and Liberty Media
Assuming the 90 days horizon Cellcom Israel is expected to under-perform the Liberty Media. In addition to that, Cellcom Israel is 4.36 times more volatile than Liberty Media. It trades about -0.01 of its total potential returns per unit of risk. Liberty Media is currently generating about 0.06 per unit of volatility. If you would invest 5,116 in Liberty Media on August 27, 2024 and sell it today you would earn a total of 2,629 from holding Liberty Media or generate 51.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 8.87% |
| Values | Daily Returns |
Cellcom Israel vs. Liberty Media
Performance |
| Timeline |
| Cellcom Israel |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Liberty Media |
Cellcom Israel and Liberty Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cellcom Israel and Liberty Media
The main advantage of trading using opposite Cellcom Israel and Liberty Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cellcom Israel position performs unexpectedly, Liberty Media 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 Liberty Media will offset losses from the drop in Liberty Media's long position.The idea behind Cellcom Israel and Liberty Media pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Liberty Media vs. Atlanta Braves Holdings, | Liberty Media vs. Madison Square Garden | Liberty Media vs. News Corp B | Liberty Media vs. News Corp A |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |