Correlation Between Clal Insurance and Melisron
Can any of the company-specific risk be diversified away by investing in both Clal Insurance and Melisron 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 Insurance and Melisron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clal Insurance Enterprises and Melisron, you can compare the effects of market volatilities on Clal Insurance and Melisron 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 Insurance with a short position of Melisron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clal Insurance and Melisron.
Diversification Opportunities for Clal Insurance and Melisron
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Clal and Melisron is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Clal Insurance Enterprises and Melisron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melisron and Clal Insurance 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 Insurance Enterprises are associated (or correlated) with Melisron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melisron has no effect on the direction of Clal Insurance i.e., Clal Insurance and Melisron go up and down completely randomly.
Pair Corralation between Clal Insurance and Melisron
Assuming the 90 days trading horizon Clal Insurance is expected to generate 1.08 times less return on investment than Melisron. In addition to that, Clal Insurance is 1.1 times more volatile than Melisron. It trades about 0.25 of its total potential returns per unit of risk. Melisron is currently generating about 0.3 per unit of volatility. If you would invest 2,975,000 in Melisron on September 1, 2024 and sell it today you would earn a total of 245,000 from holding Melisron or generate 8.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clal Insurance Enterprises vs. Melisron
Performance |
| Timeline |
| Clal Insurance Enter |
| Melisron |
Clal Insurance and Melisron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clal Insurance and Melisron
The main advantage of trading using opposite Clal Insurance and Melisron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clal Insurance position performs unexpectedly, Melisron 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 Melisron will offset losses from the drop in Melisron's long position.| Clal Insurance vs. Menif Financial Services | Clal Insurance vs. Accel Solutions Group | Clal Insurance vs. Rani Zim Shopping | Clal Insurance vs. Rapac Communication Infrastructure |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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