Correlation Between Electra Real and Azrieli
Can any of the company-specific risk be diversified away by investing in both Electra Real and Azrieli 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 Electra Real and Azrieli into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electra Real Estate and Azrieli Group, you can compare the effects of market volatilities on Electra Real and Azrieli 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 Electra Real with a short position of Azrieli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electra Real and Azrieli.
Diversification Opportunities for Electra Real and Azrieli
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Electra and Azrieli is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Electra Real Estate and Azrieli Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azrieli Group and Electra Real 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 Electra Real Estate are associated (or correlated) with Azrieli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azrieli Group has no effect on the direction of Electra Real i.e., Electra Real and Azrieli go up and down completely randomly.
Pair Corralation between Electra Real and Azrieli
Assuming the 90 days trading horizon Electra Real Estate is expected to under-perform the Azrieli. In addition to that, Electra Real is 2.08 times more volatile than Azrieli Group. It trades about -0.05 of its total potential returns per unit of risk. Azrieli Group is currently generating about -0.05 per unit of volatility. If you would invest 3,009,000 in Azrieli Group on November 3, 2024 and sell it today you would lose (39,000) from holding Azrieli Group or give up 1.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electra Real Estate vs. Azrieli Group
Performance |
| Timeline |
| Electra Real Estate |
| Azrieli Group |
Electra Real and Azrieli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electra Real and Azrieli
The main advantage of trading using opposite Electra Real and Azrieli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electra Real position performs unexpectedly, Azrieli 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 Azrieli will offset losses from the drop in Azrieli's long position.| Electra Real vs. Azrieli Group | Electra Real vs. Israel Discount Bank | Electra Real vs. Alony Hetz Properties | Electra Real vs. Shufersal |
| Azrieli vs. Melisron | Azrieli vs. Bank Leumi Le Israel | Azrieli vs. Bank Hapoalim | Azrieli 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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