Correlation Between Delek and Mizrahi Tefahot
Can any of the company-specific risk be diversified away by investing in both Delek and Mizrahi Tefahot 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 Mizrahi Tefahot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Group and Mizrahi Tefahot, you can compare the effects of market volatilities on Delek and Mizrahi Tefahot 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 Mizrahi Tefahot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek and Mizrahi Tefahot.
Diversification Opportunities for Delek and Mizrahi Tefahot
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Delek and Mizrahi is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Delek Group and Mizrahi Tefahot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mizrahi Tefahot 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 Mizrahi Tefahot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mizrahi Tefahot has no effect on the direction of Delek i.e., Delek and Mizrahi Tefahot go up and down completely randomly.
Pair Corralation between Delek and Mizrahi Tefahot
Assuming the 90 days trading horizon Delek Group is expected to generate 1.02 times more return on investment than Mizrahi Tefahot. However, Delek is 1.02 times more volatile than Mizrahi Tefahot. It trades about 0.22 of its potential returns per unit of risk. Mizrahi Tefahot is currently generating about 0.04 per unit of risk. If you would invest 4,470,683 in Delek Group on September 13, 2024 and sell it today you would earn a total of 223,317 from holding Delek Group or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Delek Group vs. Mizrahi Tefahot
Performance |
| Timeline |
| Delek Group |
| Mizrahi Tefahot |
Delek and Mizrahi Tefahot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek and Mizrahi Tefahot
The main advantage of trading using opposite Delek and Mizrahi Tefahot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek position performs unexpectedly, Mizrahi Tefahot 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 Mizrahi Tefahot will offset losses from the drop in Mizrahi Tefahot's long position.| Delek vs. Fattal 1998 Holdings | Delek vs. El Al Israel | Delek vs. Bank Leumi Le Israel | Delek vs. Teva Pharmaceutical Industries |
| Mizrahi Tefahot vs. Bank Leumi Le Israel | Mizrahi Tefahot vs. Bank Hapoalim | Mizrahi Tefahot vs. Israel Discount Bank | Mizrahi Tefahot vs. First International Bank |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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