Correlation Between GODM Investments and Amot Investments
Can any of the company-specific risk be diversified away by investing in both GODM Investments and Amot Investments 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 GODM Investments and Amot Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GODM Investments and Amot Investments, you can compare the effects of market volatilities on GODM Investments and Amot Investments 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 GODM Investments with a short position of Amot Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of GODM Investments and Amot Investments.
Diversification Opportunities for GODM Investments and Amot Investments
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GODM and Amot is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding GODM Investments and Amot Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amot Investments and GODM Investments 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 GODM Investments are associated (or correlated) with Amot Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amot Investments has no effect on the direction of GODM Investments i.e., GODM Investments and Amot Investments go up and down completely randomly.
Pair Corralation between GODM Investments and Amot Investments
Assuming the 90 days trading horizon GODM Investments is expected to under-perform the Amot Investments. In addition to that, GODM Investments is 1.79 times more volatile than Amot Investments. It trades about -0.2 of its total potential returns per unit of risk. Amot Investments is currently generating about 0.63 per unit of volatility. If you would invest 165,178 in Amot Investments on August 29, 2024 and sell it today you would earn a total of 28,322 from holding Amot Investments or generate 17.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
GODM Investments vs. Amot Investments
Performance |
| Timeline |
| GODM Investments |
| Amot Investments |
GODM Investments and Amot Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GODM Investments and Amot Investments
The main advantage of trading using opposite GODM Investments and Amot Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GODM Investments position performs unexpectedly, Amot Investments 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 Amot Investments will offset losses from the drop in Amot Investments' long position.| GODM Investments vs. Elbit Systems | GODM Investments vs. Discount Investment Corp | GODM Investments vs. Clal Insurance Enterprises | GODM Investments vs. AudioCodes |
| Amot Investments vs. Israel Canada | Amot Investments vs. Azrieli Group | Amot Investments vs. Delek Group | Amot Investments vs. Israel Discount Bank |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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