Correlation Between Discount Investment and Adgar Investments
Can any of the company-specific risk be diversified away by investing in both Discount Investment and Adgar Investments 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 Discount Investment and Adgar Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Discount Investment Corp and Adgar Investments and, you can compare the effects of market volatilities on Discount Investment and Adgar Investments 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 Discount Investment with a short position of Adgar Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Discount Investment and Adgar Investments.
Diversification Opportunities for Discount Investment and Adgar Investments
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Discount and Adgar is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Discount Investment Corp and Adgar Investments and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adgar Investments and Discount Investment 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 Discount Investment Corp are associated (or correlated) with Adgar Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adgar Investments has no effect on the direction of Discount Investment i.e., Discount Investment and Adgar Investments go up and down completely randomly.
Pair Corralation between Discount Investment and Adgar Investments
Assuming the 90 days trading horizon Discount Investment Corp is expected to generate 2.62 times more return on investment than Adgar Investments. However, Discount Investment is 2.62 times more volatile than Adgar Investments and. It trades about 0.21 of its potential returns per unit of risk. Adgar Investments and is currently generating about 0.3 per unit of risk. If you would invest 41,870 in Discount Investment Corp on August 30, 2024 and sell it today you would earn a total of 5,430 from holding Discount Investment Corp or generate 12.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
Discount Investment Corp vs. Adgar Investments and
Performance |
| Timeline |
| Discount Investment Corp |
| Adgar Investments |
Discount Investment and Adgar Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Discount Investment and Adgar Investments
The main advantage of trading using opposite Discount Investment and Adgar Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Discount Investment position performs unexpectedly, Adgar Investments 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 Adgar Investments will offset losses from the drop in Adgar Investments' long position.| Discount Investment vs. Ormat Technologies | Discount Investment vs. Multi Retail Group | Discount Investment vs. Nova | Discount Investment vs. B Communications |
| Adgar Investments vs. Alony Hetz Properties | Adgar Investments vs. Azrieli Group | Adgar Investments vs. Migdal Insurance | Adgar Investments vs. Amot Investments |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |