Correlation Between First International and Photomyne
Can any of the company-specific risk be diversified away by investing in both First International and Photomyne 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 First International and Photomyne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First International Bank and Photomyne, you can compare the effects of market volatilities on First International and Photomyne 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 First International with a short position of Photomyne. Check out your portfolio center. Please also check ongoing floating volatility patterns of First International and Photomyne.
Diversification Opportunities for First International and Photomyne
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and Photomyne is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding First International Bank and Photomyne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Photomyne and First International 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 First International Bank are associated (or correlated) with Photomyne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Photomyne has no effect on the direction of First International i.e., First International and Photomyne go up and down completely randomly.
Pair Corralation between First International and Photomyne
Assuming the 90 days trading horizon First International is expected to generate 2.11 times less return on investment than Photomyne. But when comparing it to its historical volatility, First International Bank is 1.66 times less risky than Photomyne. It trades about 0.04 of its potential returns per unit of risk. Photomyne is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 169,200 in Photomyne on August 25, 2024 and sell it today you would earn a total of 108,400 from holding Photomyne or generate 64.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First International Bank vs. Photomyne
Performance |
| Timeline |
| First International Bank |
| Photomyne |
First International and Photomyne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First International and Photomyne
The main advantage of trading using opposite First International and Photomyne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First International position performs unexpectedly, Photomyne 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 Photomyne will offset losses from the drop in Photomyne's long position.| First International vs. Bank Hapoalim | First International vs. Israel Discount Bank | First International vs. Mizrahi Tefahot | First International vs. Bezeq Israeli Telecommunication |
| Photomyne vs. Aura Investments | Photomyne vs. Harel Insurance Investments | Photomyne vs. Analyst IMS Investment | Photomyne vs. Arad Investment Industrial |
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 Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |