Correlation Between Harel Insurance and Golan Plastic
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and Golan Plastic 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 Golan Plastic 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 Golan Plastic, you can compare the effects of market volatilities on Harel Insurance and Golan Plastic 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 Golan Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and Golan Plastic.
Diversification Opportunities for Harel Insurance and Golan Plastic
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Harel and Golan is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and Golan Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golan Plastic 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 Golan Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golan Plastic has no effect on the direction of Harel Insurance i.e., Harel Insurance and Golan Plastic go up and down completely randomly.
Pair Corralation between Harel Insurance and Golan Plastic
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 0.82 times more return on investment than Golan Plastic. However, Harel Insurance Investments is 1.22 times less risky than Golan Plastic. It trades about 0.05 of its potential returns per unit of risk. Golan Plastic is currently generating about 0.03 per unit of risk. If you would invest 295,484 in Harel Insurance Investments on August 29, 2024 and sell it today you would earn a total of 139,016 from holding Harel Insurance Investments or generate 47.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.74% |
| Values | Daily Returns |
Harel Insurance Investments vs. Golan Plastic
Performance |
| Timeline |
| Harel Insurance Inve |
| Golan Plastic |
Harel Insurance and Golan Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and Golan Plastic
The main advantage of trading using opposite Harel Insurance and Golan Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, Golan Plastic 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 Golan Plastic will offset losses from the drop in Golan Plastic's long position.| Harel Insurance vs. Elbit Systems | Harel Insurance vs. Discount Investment Corp | Harel Insurance vs. Clal Insurance Enterprises | Harel Insurance vs. AudioCodes |
| Golan Plastic vs. Ormat Technologies | Golan Plastic vs. Multi Retail Group | Golan Plastic vs. Nova | Golan Plastic vs. B Communications |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |