Correlation Between Elbit Systems and Erika Carmel
Can any of the company-specific risk be diversified away by investing in both Elbit Systems and Erika Carmel 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 Systems and Erika Carmel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elbit Systems and Erika Carmel, you can compare the effects of market volatilities on Elbit Systems and Erika Carmel 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 Systems with a short position of Erika Carmel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elbit Systems and Erika Carmel.
Diversification Opportunities for Elbit Systems and Erika Carmel
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Elbit and Erika is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Elbit Systems and Erika Carmel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Erika Carmel and Elbit Systems 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 Systems are associated (or correlated) with Erika Carmel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Erika Carmel has no effect on the direction of Elbit Systems i.e., Elbit Systems and Erika Carmel go up and down completely randomly.
Pair Corralation between Elbit Systems and Erika Carmel
Assuming the 90 days trading horizon Elbit Systems is expected to generate 0.56 times more return on investment than Erika Carmel. However, Elbit Systems is 1.8 times less risky than Erika Carmel. It trades about 0.17 of its potential returns per unit of risk. Erika Carmel is currently generating about -0.15 per unit of risk. If you would invest 8,485,000 in Elbit Systems on August 30, 2024 and sell it today you would earn a total of 517,000 from holding Elbit Systems or generate 6.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Elbit Systems vs. Erika Carmel
Performance |
| Timeline |
| Elbit Systems |
| Erika Carmel |
Elbit Systems and Erika Carmel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elbit Systems and Erika Carmel
The main advantage of trading using opposite Elbit Systems and Erika Carmel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elbit Systems position performs unexpectedly, Erika Carmel 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 Erika Carmel will offset losses from the drop in Erika Carmel's long position.| Elbit Systems vs. Ormat Technologies | Elbit Systems vs. Multi Retail Group | Elbit Systems vs. Nova | Elbit Systems vs. B Communications |
| Erika Carmel vs. One Software Technologies | Erika Carmel vs. Magic Software Enterprises | Erika Carmel vs. Sofwave Medical | Erika Carmel vs. Scope Metals 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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