Correlation Between Gilat Satellite and Credo Technology

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Gilat Satellite and Credo Technology 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 Gilat Satellite and Credo Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gilat Satellite Networks and Credo Technology Group, you can compare the effects of market volatilities on Gilat Satellite and Credo Technology 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 Gilat Satellite with a short position of Credo Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gilat Satellite and Credo Technology.

Diversification Opportunities for Gilat Satellite and Credo Technology

GilatCredoDiversified AwayGilatCredoDiversified Away100%
0.49
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Gilat and Credo is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Gilat Satellite Networks and Credo Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credo Technology and Gilat Satellite 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 Gilat Satellite Networks are associated (or correlated) with Credo Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credo Technology has no effect on the direction of Gilat Satellite i.e., Gilat Satellite and Credo Technology go up and down completely randomly.

Pair Corralation between Gilat Satellite and Credo Technology

Given the investment horizon of 90 days Gilat Satellite is expected to generate 3.44 times less return on investment than Credo Technology. But when comparing it to its historical volatility, Gilat Satellite Networks is 2.24 times less risky than Credo Technology. It trades about 0.09 of its potential returns per unit of risk. Credo Technology Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,846  in Credo Technology Group on November 24, 2024 and sell it today you would earn a total of  4,832  from holding Credo Technology Group or generate 261.76% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Gilat Satellite Networks  vs.  Credo Technology Group

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -2002040
JavaScript chart by amCharts 3.21.15GILT CRDO
       Timeline  
Gilat Satellite Networks 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Gilat Satellite Networks are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating essential indicators, Gilat Satellite unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb5.566.577.58
Credo Technology 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Credo Technology Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Credo Technology displayed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb455055606570758085

Gilat Satellite and Credo Technology Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-9.48-7.1-4.72-2.340.03962.625.287.9410.61 0.0050.0100.0150.0200.0250.0300.0350.040
JavaScript chart by amCharts 3.21.15GILT CRDO
       Returns  

Pair Trading with Gilat Satellite and Credo Technology

The main advantage of trading using opposite Gilat Satellite and Credo Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gilat Satellite position performs unexpectedly, Credo Technology 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 Credo Technology will offset losses from the drop in Credo Technology's long position.
The idea behind Gilat Satellite Networks and Credo Technology Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

Other Complementary Tools

Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
ETFs
Find actively traded Exchange Traded Funds (ETF) from around the world
Fundamental Analysis
View fundamental data based on most recent published financial statements
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Transaction History
View history of all your transactions and understand their impact on performance