Correlation Between Global Knafaim and IDI Insurance
Can any of the company-specific risk be diversified away by investing in both Global Knafaim and IDI Insurance 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 Global Knafaim and IDI Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Knafaim Leasing and IDI Insurance, you can compare the effects of market volatilities on Global Knafaim and IDI Insurance 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 Global Knafaim with a short position of IDI Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Knafaim and IDI Insurance.
Diversification Opportunities for Global Knafaim and IDI Insurance
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and IDI is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Global Knafaim Leasing and IDI Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IDI Insurance and Global Knafaim 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 Global Knafaim Leasing are associated (or correlated) with IDI Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IDI Insurance has no effect on the direction of Global Knafaim i.e., Global Knafaim and IDI Insurance go up and down completely randomly.
Pair Corralation between Global Knafaim and IDI Insurance
Assuming the 90 days trading horizon Global Knafaim is expected to generate 1.59 times less return on investment than IDI Insurance. But when comparing it to its historical volatility, Global Knafaim Leasing is 1.03 times less risky than IDI Insurance. It trades about 0.08 of its potential returns per unit of risk. IDI Insurance is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 995,466 in IDI Insurance on September 3, 2024 and sell it today you would earn a total of 332,534 from holding IDI Insurance or generate 33.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Knafaim Leasing vs. IDI Insurance
Performance |
| Timeline |
| Global Knafaim Leasing |
| IDI Insurance |
Global Knafaim and IDI Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Knafaim and IDI Insurance
The main advantage of trading using opposite Global Knafaim and IDI Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Knafaim position performs unexpectedly, IDI Insurance 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 IDI Insurance will offset losses from the drop in IDI Insurance's long position.| Global Knafaim vs. Knafaim | Global Knafaim vs. El Al Israel | Global Knafaim vs. Orbit Technologies | Global Knafaim vs. Ashot Ashkelon Industries |
| IDI Insurance vs. Harel Insurance Investments | IDI Insurance vs. Migdal Insurance | IDI Insurance vs. Menora Miv Hld | IDI Insurance vs. The Phoenix Holdings |
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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