Correlation Between Delek and Teva Pharmaceutical
Can any of the company-specific risk be diversified away by investing in both Delek and Teva Pharmaceutical 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 Teva Pharmaceutical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Group and Teva Pharmaceutical Industries, you can compare the effects of market volatilities on Delek and Teva Pharmaceutical 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 Teva Pharmaceutical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek and Teva Pharmaceutical.
Diversification Opportunities for Delek and Teva Pharmaceutical
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Delek and Teva is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Delek Group and Teva Pharmaceutical Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teva Pharmaceutical 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 Teva Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teva Pharmaceutical has no effect on the direction of Delek i.e., Delek and Teva Pharmaceutical go up and down completely randomly.
Pair Corralation between Delek and Teva Pharmaceutical
Assuming the 90 days trading horizon Delek Group is expected to generate 0.94 times more return on investment than Teva Pharmaceutical. However, Delek Group is 1.07 times less risky than Teva Pharmaceutical. It trades about 0.31 of its potential returns per unit of risk. Teva Pharmaceutical Industries is currently generating about -0.35 per unit of risk. If you would invest 4,415,000 in Delek Group on August 29, 2024 and sell it today you would earn a total of 445,000 from holding Delek Group or generate 10.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Group vs. Teva Pharmaceutical Industries
Performance |
| Timeline |
| Delek Group |
| Teva Pharmaceutical |
Delek and Teva Pharmaceutical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek and Teva Pharmaceutical
The main advantage of trading using opposite Delek and Teva Pharmaceutical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek position performs unexpectedly, Teva Pharmaceutical 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 Teva Pharmaceutical will offset losses from the drop in Teva Pharmaceutical's long position.| Delek vs. Hiron Trade Investments Industrial | Delek vs. Isras Investment | Delek vs. Arad Investment Industrial | Delek vs. Big Shopping Centers |
| Teva Pharmaceutical vs. Bezeq Israeli Telecommunication | Teva Pharmaceutical vs. El Al Israel | Teva Pharmaceutical vs. Bank Leumi Le Israel | Teva Pharmaceutical vs. Elbit Systems |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |