Correlation Between Delek and Ashtrom
Can any of the company-specific risk be diversified away by investing in both Delek and Ashtrom 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 Ashtrom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Group and Ashtrom Group, you can compare the effects of market volatilities on Delek and Ashtrom 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 Ashtrom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek and Ashtrom.
Diversification Opportunities for Delek and Ashtrom
Poor diversification
The 3 months correlation between Delek and Ashtrom is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Delek Group and Ashtrom Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashtrom Group 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 Ashtrom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashtrom Group has no effect on the direction of Delek i.e., Delek and Ashtrom go up and down completely randomly.
Pair Corralation between Delek and Ashtrom
Assuming the 90 days trading horizon Delek Group is expected to generate 1.07 times more return on investment than Ashtrom. However, Delek is 1.07 times more volatile than Ashtrom Group. It trades about 0.29 of its potential returns per unit of risk. Ashtrom Group is currently generating about -0.16 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 | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Group vs. Ashtrom Group
Performance |
| Timeline |
| Delek Group |
| Ashtrom Group |
Delek and Ashtrom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek and Ashtrom
The main advantage of trading using opposite Delek and Ashtrom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek position performs unexpectedly, Ashtrom 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 Ashtrom will offset losses from the drop in Ashtrom's long position.| Delek vs. Fattal 1998 Holdings | Delek vs. El Al Israel | Delek vs. Bank Leumi Le Israel | Delek vs. Teva Pharmaceutical Industries |
| Ashtrom vs. Shikun Binui | Ashtrom vs. Alony Hetz Properties | Ashtrom vs. Amot Investments | Ashtrom vs. Azrieli Group |
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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