Correlation Between FIBI Holdings and Trendline
Can any of the company-specific risk be diversified away by investing in both FIBI Holdings and Trendline 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 Trendline into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIBI Holdings and Trendline, you can compare the effects of market volatilities on FIBI Holdings and Trendline 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 Trendline. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIBI Holdings and Trendline.
Diversification Opportunities for FIBI Holdings and Trendline
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FIBI and Trendline is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding FIBI Holdings and Trendline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trendline 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 Trendline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trendline has no effect on the direction of FIBI Holdings i.e., FIBI Holdings and Trendline go up and down completely randomly.
Pair Corralation between FIBI Holdings and Trendline
Assuming the 90 days trading horizon FIBI Holdings is expected to generate 0.88 times more return on investment than Trendline. However, FIBI Holdings is 1.14 times less risky than Trendline. It trades about 0.08 of its potential returns per unit of risk. Trendline is currently generating about -0.02 per unit of risk. If you would invest 1,421,431 in FIBI Holdings on September 2, 2024 and sell it today you would earn a total of 367,569 from holding FIBI Holdings or generate 25.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIBI Holdings vs. Trendline
Performance |
| Timeline |
| FIBI Holdings |
| Trendline |
FIBI Holdings and Trendline Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIBI Holdings and Trendline
The main advantage of trading using opposite FIBI Holdings and Trendline positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIBI Holdings position performs unexpectedly, Trendline 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 Trendline will offset losses from the drop in Trendline'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 |
| Trendline vs. Suny Cellular Communication | Trendline vs. Adgar Investments and | Trendline vs. Discount Investment Corp | Trendline vs. Bezeq Israeli Telecommunication |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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