Correlation Between Elbit Imaging and Brainsway
Can any of the company-specific risk be diversified away by investing in both Elbit Imaging and Brainsway 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 Elbit Imaging and Brainsway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elbit Imaging and Brainsway, you can compare the effects of market volatilities on Elbit Imaging and Brainsway 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 Elbit Imaging with a short position of Brainsway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elbit Imaging and Brainsway.
Diversification Opportunities for Elbit Imaging and Brainsway
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Elbit and Brainsway is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Elbit Imaging and Brainsway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brainsway and Elbit Imaging 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 Elbit Imaging are associated (or correlated) with Brainsway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brainsway has no effect on the direction of Elbit Imaging i.e., Elbit Imaging and Brainsway go up and down completely randomly.
Pair Corralation between Elbit Imaging and Brainsway
Assuming the 90 days trading horizon Elbit Imaging is expected to generate 0.59 times more return on investment than Brainsway. However, Elbit Imaging is 1.71 times less risky than Brainsway. It trades about 0.35 of its potential returns per unit of risk. Brainsway is currently generating about -0.04 per unit of risk. If you would invest 46,600 in Elbit Imaging on August 29, 2024 and sell it today you would earn a total of 5,600 from holding Elbit Imaging or generate 12.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elbit Imaging vs. Brainsway
Performance |
| Timeline |
| Elbit Imaging |
| Brainsway |
Elbit Imaging and Brainsway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elbit Imaging and Brainsway
The main advantage of trading using opposite Elbit Imaging and Brainsway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elbit Imaging position performs unexpectedly, Brainsway 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 Brainsway will offset losses from the drop in Brainsway's long position.| Elbit Imaging vs. Clal Insurance Enterprises | Elbit Imaging vs. Harel Insurance Investments | Elbit Imaging vs. Feat Fund Investments | Elbit Imaging vs. Blender Financial Technologies |
| Brainsway vs. Brainsway | Brainsway vs. Kamada | Brainsway vs. Foresight Autonomous Holdings | Brainsway vs. Compugen |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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