Correlation Between Harel Insurance and Electra
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and Electra 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 Electra 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 Electra, you can compare the effects of market volatilities on Harel Insurance and Electra 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 Electra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and Electra.
Diversification Opportunities for Harel Insurance and Electra
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Harel and Electra is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and Electra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electra 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 Electra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electra has no effect on the direction of Harel Insurance i.e., Harel Insurance and Electra go up and down completely randomly.
Pair Corralation between Harel Insurance and Electra
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 0.94 times more return on investment than Electra. However, Harel Insurance Investments is 1.07 times less risky than Electra. It trades about 0.08 of its potential returns per unit of risk. Electra is currently generating about 0.03 per unit of risk. If you would invest 278,130 in Harel Insurance Investments on September 2, 2024 and sell it today you would earn a total of 159,870 from holding Harel Insurance Investments or generate 57.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harel Insurance Investments vs. Electra
Performance |
| Timeline |
| Harel Insurance Inve |
| Electra |
Harel Insurance and Electra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and Electra
The main advantage of trading using opposite Harel Insurance and Electra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, Electra 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 Electra will offset losses from the drop in Electra's long position.| Harel Insurance vs. Menif Financial Services | Harel Insurance vs. Accel Solutions Group | Harel Insurance vs. Rani Zim Shopping | Harel Insurance vs. Rapac Communication Infrastructure |
| Electra vs. Alony Hetz Properties | Electra vs. Melisron | Electra vs. Shufersal | Electra 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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