Correlation Between C Mer and Harel Insurance
Can any of the company-specific risk be diversified away by investing in both C Mer and Harel Insurance 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 C Mer and Harel Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between C Mer Industries and Harel Insurance Investments, you can compare the effects of market volatilities on C Mer and Harel Insurance 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 C Mer with a short position of Harel Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of C Mer and Harel Insurance.
Diversification Opportunities for C Mer and Harel Insurance
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CMER and Harel is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding C Mer Industries and Harel Insurance Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harel Insurance Inve and C Mer 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 C Mer Industries are associated (or correlated) with Harel Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harel Insurance Inve has no effect on the direction of C Mer i.e., C Mer and Harel Insurance go up and down completely randomly.
Pair Corralation between C Mer and Harel Insurance
Assuming the 90 days trading horizon C Mer Industries is expected to generate 3.03 times more return on investment than Harel Insurance. However, C Mer is 3.03 times more volatile than Harel Insurance Investments. It trades about 0.27 of its potential returns per unit of risk. Harel Insurance Investments is currently generating about 0.61 per unit of risk. If you would invest 185,000 in C Mer Industries on September 13, 2024 and sell it today you would earn a total of 83,700 from holding C Mer Industries or generate 45.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
C Mer Industries vs. Harel Insurance Investments
Performance |
| Timeline |
| C Mer Industries |
| Harel Insurance Inve |
C Mer and Harel Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with C Mer and Harel Insurance
The main advantage of trading using opposite C Mer and Harel Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C Mer position performs unexpectedly, Harel Insurance 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 Harel Insurance will offset losses from the drop in Harel Insurance's long position.| C Mer vs. Analyst IMS Investment | C Mer vs. Millennium Food Tech LP | C Mer vs. Adgar Investments and | C Mer vs. MEITAV INVESTMENTS HOUSE |
| Harel Insurance vs. Bank Hapoalim | Harel Insurance vs. Israel Discount Bank | Harel Insurance vs. Mizrahi Tefahot | Harel Insurance vs. Bezeq Israeli Telecommunication |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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