Correlation Between Global Knafaim and Sarine Technologies
Can any of the company-specific risk be diversified away by investing in both Global Knafaim and Sarine Technologies 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 Sarine Technologies 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 Sarine Technologies, you can compare the effects of market volatilities on Global Knafaim and Sarine Technologies 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 Sarine Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Knafaim and Sarine Technologies.
Diversification Opportunities for Global Knafaim and Sarine Technologies
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Sarine is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Global Knafaim Leasing and Sarine Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sarine Technologies 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 Sarine Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sarine Technologies has no effect on the direction of Global Knafaim i.e., Global Knafaim and Sarine Technologies go up and down completely randomly.
Pair Corralation between Global Knafaim and Sarine Technologies
Assuming the 90 days trading horizon Global Knafaim Leasing is expected to generate 0.76 times more return on investment than Sarine Technologies. However, Global Knafaim Leasing is 1.32 times less risky than Sarine Technologies. It trades about 0.04 of its potential returns per unit of risk. Sarine Technologies is currently generating about -0.02 per unit of risk. If you would invest 5,372 in Global Knafaim Leasing on August 27, 2024 and sell it today you would earn a total of 1,848 from holding Global Knafaim Leasing or generate 34.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Knafaim Leasing vs. Sarine Technologies
Performance |
| Timeline |
| Global Knafaim Leasing |
| Sarine Technologies |
Global Knafaim and Sarine Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Knafaim and Sarine Technologies
The main advantage of trading using opposite Global Knafaim and Sarine Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Knafaim position performs unexpectedly, Sarine Technologies 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 Sarine Technologies will offset losses from the drop in Sarine Technologies' long position.| Global Knafaim vs. Arad | Global Knafaim vs. Alony Hetz Properties | Global Knafaim vs. Danel | Global Knafaim vs. Airport City |
| Sarine Technologies vs. Arad | Sarine Technologies vs. C I Systems | Sarine Technologies vs. Scope Metals Group |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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