Correlation Between Clal Insurance and Sella Real
Can any of the company-specific risk be diversified away by investing in both Clal Insurance and Sella Real 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 Sella Real 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 Sella Real Estate, you can compare the effects of market volatilities on Clal Insurance and Sella Real 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 Sella Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clal Insurance and Sella Real.
Diversification Opportunities for Clal Insurance and Sella Real
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Clal and Sella is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Clal Insurance Enterprises and Sella Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sella Real Estate 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 Sella Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sella Real Estate has no effect on the direction of Clal Insurance i.e., Clal Insurance and Sella Real go up and down completely randomly.
Pair Corralation between Clal Insurance and Sella Real
Assuming the 90 days trading horizon Clal Insurance is expected to generate 1.02 times less return on investment than Sella Real. In addition to that, Clal Insurance is 1.09 times more volatile than Sella Real Estate. It trades about 0.04 of its total potential returns per unit of risk. Sella Real Estate is currently generating about 0.04 per unit of volatility. If you would invest 70,879 in Sella Real Estate on September 3, 2024 and sell it today you would earn a total of 19,121 from holding Sella Real Estate or generate 26.98% 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. Sella Real Estate
Performance |
| Timeline |
| Clal Insurance Enter |
| Sella Real Estate |
Clal Insurance and Sella Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clal Insurance and Sella Real
The main advantage of trading using opposite Clal Insurance and Sella Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clal Insurance position performs unexpectedly, Sella Real 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 Sella Real will offset losses from the drop in Sella Real's long position.| Clal Insurance vs. Bank Hapoalim | Clal Insurance vs. Israel Discount Bank | Clal Insurance vs. First International Bank | Clal Insurance vs. Elbit Systems |
| Sella Real vs. Nextage Therapeutics | Sella Real vs. Israel China Biotechnology | Sella Real vs. The Gold Bond | Sella Real vs. Overseas Commerce |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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