Correlation Between Gold Bond and Poalim Ibi
Can any of the company-specific risk be diversified away by investing in both Gold Bond and Poalim Ibi 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 Poalim Ibi 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 Poalim Ibi, you can compare the effects of market volatilities on Gold Bond and Poalim Ibi 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 Poalim Ibi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Bond and Poalim Ibi.
Diversification Opportunities for Gold Bond and Poalim Ibi
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Gold and Poalim is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding The Gold Bond and Poalim Ibi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poalim Ibi 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 Poalim Ibi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poalim Ibi has no effect on the direction of Gold Bond i.e., Gold Bond and Poalim Ibi go up and down completely randomly.
Pair Corralation between Gold Bond and Poalim Ibi
Assuming the 90 days trading horizon Gold Bond is expected to generate 1.5 times less return on investment than Poalim Ibi. But when comparing it to its historical volatility, The Gold Bond is 1.14 times less risky than Poalim Ibi. It trades about 0.05 of its potential returns per unit of risk. Poalim Ibi is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 56,420 in Poalim Ibi on November 28, 2024 and sell it today you would earn a total of 35,400 from holding Poalim Ibi or generate 62.74% 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. Poalim Ibi
Performance |
| Timeline |
| Gold Bond |
| Poalim Ibi |
Gold Bond and Poalim Ibi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Bond and Poalim Ibi
The main advantage of trading using opposite Gold Bond and Poalim Ibi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Bond position performs unexpectedly, Poalim Ibi 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 Poalim Ibi will offset losses from the drop in Poalim Ibi'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 |
| Poalim Ibi vs. Payment Financial Technologies | Poalim Ibi vs. Shagrir Group Vehicle | Poalim Ibi vs. Batm Advanced Communications | Poalim Ibi vs. First International 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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