Correlation Between Danel and Infimer
Can any of the company-specific risk be diversified away by investing in both Danel and Infimer 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 Danel and Infimer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Danel and Infimer, you can compare the effects of market volatilities on Danel and Infimer 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 Danel with a short position of Infimer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Danel and Infimer.
Diversification Opportunities for Danel and Infimer
Average diversification
The 3 months correlation between Danel and Infimer is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Danel and Infimer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infimer and Danel 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 Danel are associated (or correlated) with Infimer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infimer has no effect on the direction of Danel i.e., Danel and Infimer go up and down completely randomly.
Pair Corralation between Danel and Infimer
Assuming the 90 days trading horizon Danel is expected to generate 0.12 times more return on investment than Infimer. However, Danel is 8.62 times less risky than Infimer. It trades about 0.03 of its potential returns per unit of risk. Infimer is currently generating about -0.17 per unit of risk. If you would invest 4,155,000 in Danel on December 1, 2024 and sell it today you would earn a total of 26,000 from holding Danel or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Danel vs. Infimer
Performance |
| Timeline |
| Danel |
| Infimer |
Danel and Infimer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Danel and Infimer
The main advantage of trading using opposite Danel and Infimer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Danel position performs unexpectedly, Infimer 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 Infimer will offset losses from the drop in Infimer's long position.| Danel vs. Hilan | Danel vs. Fattal 1998 Holdings | Danel vs. Matrix | Danel vs. Bezeq Israeli Telecommunication |
| Infimer vs. Magic Software Enterprises | Infimer vs. Spuntech | Infimer vs. Dan Hotels | Infimer vs. Imed Infinity Medical Limited |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |