Correlation Between Gilat Satellite and Silicom
Can any of the company-specific risk be diversified away by investing in both Gilat Satellite and Silicom 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 Silicom 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 Silicom, you can compare the effects of market volatilities on Gilat Satellite and Silicom 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 Silicom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gilat Satellite and Silicom.
Diversification Opportunities for Gilat Satellite and Silicom
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gilat and Silicom is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Gilat Satellite Networks and Silicom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silicom 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 Silicom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silicom has no effect on the direction of Gilat Satellite i.e., Gilat Satellite and Silicom go up and down completely randomly.
Pair Corralation between Gilat Satellite and Silicom
Given the investment horizon of 90 days Gilat Satellite Networks is expected to generate 0.84 times more return on investment than Silicom. However, Gilat Satellite Networks is 1.19 times less risky than Silicom. It trades about 0.0 of its potential returns per unit of risk. Silicom is currently generating about -0.07 per unit of risk. If you would invest 597.00 in Gilat Satellite Networks on August 24, 2024 and sell it today you would lose (73.00) from holding Gilat Satellite Networks or give up 12.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gilat Satellite Networks vs. Silicom
Performance |
| Timeline |
| Gilat Satellite Networks |
| Silicom |
Gilat Satellite and Silicom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gilat Satellite and Silicom
The main advantage of trading using opposite Gilat Satellite and Silicom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gilat Satellite position performs unexpectedly, Silicom 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 Silicom will offset losses from the drop in Silicom's long position.| Gilat Satellite vs. ADTRAN Inc | Gilat Satellite vs. Mynaric AG ADR | Gilat Satellite vs. KVH Industries | Gilat Satellite vs. Telesat Corp |
| Silicom vs. Ituran Location and | Silicom vs. Sapiens International | Silicom vs. Allot Communications | Silicom vs. Radcom |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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