Correlation Between YH Dimri and Prashkovsky
Can any of the company-specific risk be diversified away by investing in both YH Dimri and Prashkovsky 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 YH Dimri and Prashkovsky into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YH Dimri Construction and Prashkovsky, you can compare the effects of market volatilities on YH Dimri and Prashkovsky 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 YH Dimri with a short position of Prashkovsky. Check out your portfolio center. Please also check ongoing floating volatility patterns of YH Dimri and Prashkovsky.
Diversification Opportunities for YH Dimri and Prashkovsky
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DIMRI and Prashkovsky is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding YH Dimri Construction and Prashkovsky in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prashkovsky and YH Dimri 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 YH Dimri Construction are associated (or correlated) with Prashkovsky. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prashkovsky has no effect on the direction of YH Dimri i.e., YH Dimri and Prashkovsky go up and down completely randomly.
Pair Corralation between YH Dimri and Prashkovsky
Assuming the 90 days trading horizon YH Dimri Construction is expected to under-perform the Prashkovsky. But the stock apears to be less risky and, when comparing its historical volatility, YH Dimri Construction is 1.22 times less risky than Prashkovsky. The stock trades about -0.24 of its potential returns per unit of risk. The Prashkovsky is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 1,044,000 in Prashkovsky on November 27, 2024 and sell it today you would lose (72,000) from holding Prashkovsky or give up 6.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YH Dimri Construction vs. Prashkovsky
Performance |
| Timeline |
| YH Dimri Construction |
| Prashkovsky |
YH Dimri and Prashkovsky Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YH Dimri and Prashkovsky
The main advantage of trading using opposite YH Dimri and Prashkovsky positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YH Dimri position performs unexpectedly, Prashkovsky 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 Prashkovsky will offset losses from the drop in Prashkovsky's long position.| YH Dimri vs. Azrieli Group | YH Dimri vs. Israel Canada | YH Dimri vs. Ashtrom Group | YH Dimri vs. Shikun Binui |
| Prashkovsky vs. Israel Canada | Prashkovsky vs. YH Dimri Construction | Prashkovsky vs. Shikun Binui | Prashkovsky vs. Electra Real Estate |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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