Correlation Between Cellcom Israel and KT
Can any of the company-specific risk be diversified away by investing in both Cellcom Israel and KT 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 KT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cellcom Israel and KT Corporation, you can compare the effects of market volatilities on Cellcom Israel and KT 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 KT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cellcom Israel and KT.
Diversification Opportunities for Cellcom Israel and KT
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cellcom and KT is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Cellcom Israel and KT Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Corporation 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 KT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Corporation has no effect on the direction of Cellcom Israel i.e., Cellcom Israel and KT go up and down completely randomly.
Pair Corralation between Cellcom Israel and KT
Assuming the 90 days horizon Cellcom Israel is expected to generate 4.53 times more return on investment than KT. However, Cellcom Israel is 4.53 times more volatile than KT Corporation. It trades about 0.09 of its potential returns per unit of risk. KT Corporation is currently generating about 0.06 per unit of risk. If you would invest 434.00 in Cellcom Israel on August 31, 2024 and sell it today you would earn a total of 66.00 from holding Cellcom Israel or generate 15.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 8.08% |
| Values | Daily Returns |
Cellcom Israel vs. KT Corp.
Performance |
| Timeline |
| Cellcom Israel |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| KT Corporation |
Cellcom Israel and KT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cellcom Israel and KT
The main advantage of trading using opposite Cellcom Israel and KT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cellcom Israel position performs unexpectedly, KT 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 KT will offset losses from the drop in KT's long position.| Cellcom Israel vs. Straumann Holding AG | Cellcom Israel vs. Singapore Exchange Ltd | Cellcom Israel vs. Japan Exchange Group | Cellcom Israel vs. XL Axiata Tbk |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |