Correlation Between Clal Insurance and XTL Biopharmaceutica
Can any of the company-specific risk be diversified away by investing in both Clal Insurance and XTL Biopharmaceutica 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 XTL Biopharmaceutica 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 XTL Biopharmaceuticals, you can compare the effects of market volatilities on Clal Insurance and XTL Biopharmaceutica 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 XTL Biopharmaceutica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clal Insurance and XTL Biopharmaceutica.
Diversification Opportunities for Clal Insurance and XTL Biopharmaceutica
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clal and XTL is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Clal Insurance Enterprises and XTL Biopharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XTL Biopharmaceuticals 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 XTL Biopharmaceutica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XTL Biopharmaceuticals has no effect on the direction of Clal Insurance i.e., Clal Insurance and XTL Biopharmaceutica go up and down completely randomly.
Pair Corralation between Clal Insurance and XTL Biopharmaceutica
Assuming the 90 days trading horizon Clal Insurance Enterprises is expected to generate 0.33 times more return on investment than XTL Biopharmaceutica. However, Clal Insurance Enterprises is 3.05 times less risky than XTL Biopharmaceutica. It trades about 0.31 of its potential returns per unit of risk. XTL Biopharmaceuticals is currently generating about -0.13 per unit of risk. If you would invest 590,000 in Clal Insurance Enterprises on August 29, 2024 and sell it today you would earn a total of 176,900 from holding Clal Insurance Enterprises or generate 29.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clal Insurance Enterprises vs. XTL Biopharmaceuticals
Performance |
| Timeline |
| Clal Insurance Enter |
| XTL Biopharmaceuticals |
Clal Insurance and XTL Biopharmaceutica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clal Insurance and XTL Biopharmaceutica
The main advantage of trading using opposite Clal Insurance and XTL Biopharmaceutica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clal Insurance position performs unexpectedly, XTL Biopharmaceutica 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 XTL Biopharmaceutica will offset losses from the drop in XTL Biopharmaceutica's long position.| Clal Insurance vs. Elbit Systems | Clal Insurance vs. Discount Investment Corp | Clal Insurance vs. AudioCodes | Clal Insurance vs. Shufersal |
| XTL Biopharmaceutica vs. XTL Biopharmaceuticals Ltd | XTL Biopharmaceutica vs. Intercure | XTL Biopharmaceutica vs. BioLine RX | XTL Biopharmaceutica vs. Foresight Autonomous Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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