Correlation Between Global Knafaim and Rimon Consulting
Can any of the company-specific risk be diversified away by investing in both Global Knafaim and Rimon Consulting 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 Rimon Consulting 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 Rimon Consulting Management, you can compare the effects of market volatilities on Global Knafaim and Rimon Consulting 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 Rimon Consulting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Knafaim and Rimon Consulting.
Diversification Opportunities for Global Knafaim and Rimon Consulting
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Global and Rimon is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Global Knafaim Leasing and Rimon Consulting Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rimon Consulting Man 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 Rimon Consulting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rimon Consulting Man has no effect on the direction of Global Knafaim i.e., Global Knafaim and Rimon Consulting go up and down completely randomly.
Pair Corralation between Global Knafaim and Rimon Consulting
Assuming the 90 days trading horizon Global Knafaim Leasing is expected to under-perform the Rimon Consulting. But the stock apears to be less risky and, when comparing its historical volatility, Global Knafaim Leasing is 1.42 times less risky than Rimon Consulting. The stock trades about -0.17 of its potential returns per unit of risk. The Rimon Consulting Management is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest 371,600 in Rimon Consulting Management on August 28, 2024 and sell it today you would earn a total of 78,000 from holding Rimon Consulting Management or generate 20.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Knafaim Leasing vs. Rimon Consulting Management
Performance |
| Timeline |
| Global Knafaim Leasing |
| Rimon Consulting Man |
Global Knafaim and Rimon Consulting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Knafaim and Rimon Consulting
The main advantage of trading using opposite Global Knafaim and Rimon Consulting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Knafaim position performs unexpectedly, Rimon Consulting 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 Rimon Consulting will offset losses from the drop in Rimon Consulting's long position.| Global Knafaim vs. Arad | Global Knafaim vs. Alony Hetz Properties | Global Knafaim vs. Danel | Global Knafaim vs. Airport City |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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