Correlation Between Harel Insurance and C I
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and C I 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 Harel Insurance and C I into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harel Insurance Investments and C I Systems, you can compare the effects of market volatilities on Harel Insurance and C I 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 Harel Insurance with a short position of C I. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and C I.
Diversification Opportunities for Harel Insurance and C I
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Harel and CISY is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and C I Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C I Systems and Harel Insurance 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 Harel Insurance Investments are associated (or correlated) with C I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C I Systems has no effect on the direction of Harel Insurance i.e., Harel Insurance and C I go up and down completely randomly.
Pair Corralation between Harel Insurance and C I
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 1.25 times more return on investment than C I. However, Harel Insurance is 1.25 times more volatile than C I Systems. It trades about 0.33 of its potential returns per unit of risk. C I Systems is currently generating about 0.02 per unit of risk. If you would invest 392,000 in Harel Insurance Investments on September 4, 2024 and sell it today you would earn a total of 40,000 from holding Harel Insurance Investments or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harel Insurance Investments vs. C I Systems
Performance |
| Timeline |
| Harel Insurance Inve |
| C I Systems |
Harel Insurance and C I Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and C I
The main advantage of trading using opposite Harel Insurance and C I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, C I 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 C I will offset losses from the drop in C I's long position.| Harel Insurance vs. Bank Hapoalim | Harel Insurance vs. Israel Discount Bank | Harel Insurance vs. First International Bank | Harel Insurance vs. Elbit Systems |
| C I vs. Abra Information Technologies | C I vs. Harel Insurance Investments | C I vs. Petrochemical | C I vs. Ram On Investments and |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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