Correlation Between Delek and Amot Investments
Can any of the company-specific risk be diversified away by investing in both Delek and Amot 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 Delek and Amot Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Group and Amot Investments, you can compare the effects of market volatilities on Delek and Amot 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 Delek with a short position of Amot Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek and Amot Investments.
Diversification Opportunities for Delek and Amot Investments
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Delek and Amot is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Delek Group and Amot Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amot Investments and Delek 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 Delek Group are associated (or correlated) with Amot Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amot Investments has no effect on the direction of Delek i.e., Delek and Amot Investments go up and down completely randomly.
Pair Corralation between Delek and Amot Investments
Assuming the 90 days trading horizon Delek Group is expected to generate 1.81 times more return on investment than Amot Investments. However, Delek is 1.81 times more volatile than Amot Investments. It trades about 0.29 of its potential returns per unit of risk. Amot Investments is currently generating about 0.2 per unit of risk. If you would invest 4,773,000 in Delek Group on October 26, 2024 and sell it today you would earn a total of 567,000 from holding Delek Group or generate 11.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Group vs. Amot Investments
Performance |
| Timeline |
| Delek Group |
| Amot Investments |
Delek and Amot Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek and Amot Investments
The main advantage of trading using opposite Delek and Amot Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek position performs unexpectedly, Amot 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 Amot Investments will offset losses from the drop in Amot Investments' long position.| Delek vs. Fattal 1998 Holdings | Delek vs. El Al Israel | Delek vs. Bank Leumi Le Israel | Delek vs. Teva Pharmaceutical Industries |
| Amot Investments vs. Alony Hetz Properties | Amot Investments vs. Azrieli Group | Amot Investments vs. Melisron | Amot Investments vs. Bank Leumi Le 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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