Correlation Between Gold Bond and Azrieli
Can any of the company-specific risk be diversified away by investing in both Gold Bond and Azrieli 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 Gold Bond and Azrieli into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Gold Bond and Azrieli Group, you can compare the effects of market volatilities on Gold Bond and Azrieli 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 Gold Bond with a short position of Azrieli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Bond and Azrieli.
Diversification Opportunities for Gold Bond and Azrieli
Almost no diversification
The 3 months correlation between Gold and Azrieli is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding The Gold Bond and Azrieli Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azrieli Group and Gold Bond 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 The Gold Bond are associated (or correlated) with Azrieli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azrieli Group has no effect on the direction of Gold Bond i.e., Gold Bond and Azrieli go up and down completely randomly.
Pair Corralation between Gold Bond and Azrieli
Assuming the 90 days trading horizon Gold Bond is expected to generate 1.21 times less return on investment than Azrieli. But when comparing it to its historical volatility, The Gold Bond is 1.09 times less risky than Azrieli. It trades about 0.2 of its potential returns per unit of risk. Azrieli Group is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 2,684,000 in Azrieli Group on August 24, 2024 and sell it today you would earn a total of 166,000 from holding Azrieli Group or generate 6.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Gold Bond vs. Azrieli Group
Performance |
| Timeline |
| Gold Bond |
| Azrieli Group |
Gold Bond and Azrieli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Bond and Azrieli
The main advantage of trading using opposite Gold Bond and Azrieli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Bond position performs unexpectedly, Azrieli 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 Azrieli will offset losses from the drop in Azrieli's long position.| Gold Bond vs. Big Shopping Centers | Gold Bond vs. Al Bad Massuot Yitzhak | Gold Bond vs. Harel Insurance Investments | Gold Bond vs. Palram |
| Azrieli vs. Israel Canada | Azrieli vs. Delek Group | Azrieli vs. Shikun Binui | Azrieli 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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