Correlation Between Golan Plastic and Silver Castle
Can any of the company-specific risk be diversified away by investing in both Golan Plastic and Silver Castle 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 Golan Plastic and Silver Castle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golan Plastic and Silver Castle Holdings, you can compare the effects of market volatilities on Golan Plastic and Silver Castle 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 Golan Plastic with a short position of Silver Castle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golan Plastic and Silver Castle.
Diversification Opportunities for Golan Plastic and Silver Castle
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Golan and Silver is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Golan Plastic and Silver Castle Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silver Castle Holdings and Golan Plastic 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 Golan Plastic are associated (or correlated) with Silver Castle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silver Castle Holdings has no effect on the direction of Golan Plastic i.e., Golan Plastic and Silver Castle go up and down completely randomly.
Pair Corralation between Golan Plastic and Silver Castle
Assuming the 90 days trading horizon Golan Plastic is expected to generate 0.65 times more return on investment than Silver Castle. However, Golan Plastic is 1.54 times less risky than Silver Castle. It trades about 0.36 of its potential returns per unit of risk. Silver Castle Holdings is currently generating about 0.01 per unit of risk. If you would invest 100,000 in Golan Plastic on August 31, 2024 and sell it today you would earn a total of 18,000 from holding Golan Plastic or generate 18.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golan Plastic vs. Silver Castle Holdings
Performance |
| Timeline |
| Golan Plastic |
| Silver Castle Holdings |
Golan Plastic and Silver Castle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golan Plastic and Silver Castle
The main advantage of trading using opposite Golan Plastic and Silver Castle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golan Plastic position performs unexpectedly, Silver Castle 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 Silver Castle will offset losses from the drop in Silver Castle's long position.| Golan Plastic vs. Arad | Golan Plastic vs. Alony Hetz Properties | Golan Plastic vs. Danel | Golan Plastic vs. Airport City |
| Silver Castle vs. Generation Capital | Silver Castle vs. Meitav Dash Investments | Silver Castle vs. IBI Inv House | Silver Castle vs. Mivtach Shamir |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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