Correlation Between Dan Hotels and Intercure
Can any of the company-specific risk be diversified away by investing in both Dan Hotels and Intercure 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 Intercure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dan Hotels and Intercure, you can compare the effects of market volatilities on Dan Hotels and Intercure 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 Intercure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dan Hotels and Intercure.
Diversification Opportunities for Dan Hotels and Intercure
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dan and Intercure is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Dan Hotels and Intercure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intercure 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 Intercure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intercure has no effect on the direction of Dan Hotels i.e., Dan Hotels and Intercure go up and down completely randomly.
Pair Corralation between Dan Hotels and Intercure
Assuming the 90 days trading horizon Dan Hotels is expected to generate 0.36 times more return on investment than Intercure. However, Dan Hotels is 2.8 times less risky than Intercure. It trades about 0.06 of its potential returns per unit of risk. Intercure is currently generating about -0.22 per unit of risk. If you would invest 214,300 in Dan Hotels on August 29, 2024 and sell it today you would earn a total of 13,200 from holding Dan Hotels or generate 6.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dan Hotels vs. Intercure
Performance |
| Timeline |
| Dan Hotels |
| Intercure |
Dan Hotels and Intercure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dan Hotels and Intercure
The main advantage of trading using opposite Dan Hotels and Intercure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dan Hotels position performs unexpectedly, Intercure 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 Intercure will offset losses from the drop in Intercure's long position.| Dan Hotels vs. Clal Insurance Enterprises | Dan Hotels vs. Israel Discount Bank | Dan Hotels vs. Bezeq Israeli Telecommunication | Dan Hotels vs. Alony Hetz Properties |
| Intercure vs. Together Startup Network | Intercure vs. Delek Group | Intercure vs. Teva Pharmaceutical Industries | Intercure vs. El Al Israel |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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