Correlation Between FIBI Holdings and Poalim Ibi
Can any of the company-specific risk be diversified away by investing in both FIBI Holdings and Poalim Ibi 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 FIBI Holdings and Poalim Ibi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIBI Holdings and Poalim Ibi, you can compare the effects of market volatilities on FIBI Holdings and Poalim Ibi 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 FIBI Holdings with a short position of Poalim Ibi. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIBI Holdings and Poalim Ibi.
Diversification Opportunities for FIBI Holdings and Poalim Ibi
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between FIBI and Poalim is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding FIBI Holdings and Poalim Ibi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poalim Ibi and FIBI Holdings 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 FIBI Holdings are associated (or correlated) with Poalim Ibi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poalim Ibi has no effect on the direction of FIBI Holdings i.e., FIBI Holdings and Poalim Ibi go up and down completely randomly.
Pair Corralation between FIBI Holdings and Poalim Ibi
Assuming the 90 days trading horizon FIBI Holdings is expected to generate 0.42 times more return on investment than Poalim Ibi. However, FIBI Holdings is 2.38 times less risky than Poalim Ibi. It trades about 0.29 of its potential returns per unit of risk. Poalim Ibi is currently generating about 0.11 per unit of risk. If you would invest 1,739,000 in FIBI Holdings on August 30, 2024 and sell it today you would earn a total of 81,000 from holding FIBI Holdings or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIBI Holdings vs. Poalim Ibi
Performance |
| Timeline |
| FIBI Holdings |
| Poalim Ibi |
FIBI Holdings and Poalim Ibi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIBI Holdings and Poalim Ibi
The main advantage of trading using opposite FIBI Holdings and Poalim Ibi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIBI Holdings position performs unexpectedly, Poalim Ibi 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 Poalim Ibi will offset losses from the drop in Poalim Ibi's long position.| FIBI Holdings vs. First International Bank | FIBI Holdings vs. Mizrahi Tefahot | FIBI Holdings vs. Israel Discount Bank | FIBI Holdings vs. Bank Leumi Le Israel |
| Poalim Ibi vs. Elbit Systems | Poalim Ibi vs. Discount Investment Corp | Poalim Ibi vs. AudioCodes | Poalim Ibi vs. Shufersal |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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