Correlation Between Dan Hotels and Elbit Medical
Can any of the company-specific risk be diversified away by investing in both Dan Hotels and Elbit Medical 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 Dan Hotels and Elbit Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dan Hotels and Elbit Medical Technologies, you can compare the effects of market volatilities on Dan Hotels and Elbit Medical 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 Dan Hotels with a short position of Elbit Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dan Hotels and Elbit Medical.
Diversification Opportunities for Dan Hotels and Elbit Medical
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dan and Elbit is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Dan Hotels and Elbit Medical Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elbit Medical Techno and Dan Hotels 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 Dan Hotels are associated (or correlated) with Elbit Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elbit Medical Techno has no effect on the direction of Dan Hotels i.e., Dan Hotels and Elbit Medical go up and down completely randomly.
Pair Corralation between Dan Hotels and Elbit Medical
Assuming the 90 days trading horizon Dan Hotels is expected to generate 0.67 times more return on investment than Elbit Medical. However, Dan Hotels is 1.5 times less risky than Elbit Medical. It trades about 0.18 of its potential returns per unit of risk. Elbit Medical Technologies is currently generating about -0.53 per unit of risk. If you would invest 229,700 in Dan Hotels on September 13, 2024 and sell it today you would earn a total of 17,300 from holding Dan Hotels or generate 7.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dan Hotels vs. Elbit Medical Technologies
Performance |
| Timeline |
| Dan Hotels |
| Elbit Medical Techno |
Dan Hotels and Elbit Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dan Hotels and Elbit Medical
The main advantage of trading using opposite Dan Hotels and Elbit Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dan Hotels position performs unexpectedly, Elbit Medical 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 Elbit Medical will offset losses from the drop in Elbit Medical's long position.| Dan Hotels vs. Migdal Insurance | Dan Hotels vs. Clal Insurance Enterprises | Dan Hotels vs. Bank Leumi Le Israel | Dan Hotels vs. Israel Discount Bank |
| Elbit Medical vs. Nice | Elbit Medical vs. The Gold Bond | Elbit Medical vs. Bank Leumi Le Israel | Elbit Medical vs. ICL Israel Chemicals |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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