Correlation Between Harel Insurance and Gencell
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and Gencell 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 Gencell 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 Gencell, you can compare the effects of market volatilities on Harel Insurance and Gencell 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 Gencell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and Gencell.
Diversification Opportunities for Harel Insurance and Gencell
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Harel and Gencell is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and Gencell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gencell 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 Gencell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gencell has no effect on the direction of Harel Insurance i.e., Harel Insurance and Gencell go up and down completely randomly.
Pair Corralation between Harel Insurance and Gencell
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 0.45 times more return on investment than Gencell. However, Harel Insurance Investments is 2.21 times less risky than Gencell. It trades about 0.42 of its potential returns per unit of risk. Gencell is currently generating about 0.04 per unit of risk. If you would invest 344,024 in Harel Insurance Investments on September 12, 2024 and sell it today you would earn a total of 138,976 from holding Harel Insurance Investments or generate 40.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harel Insurance Investments vs. Gencell
Performance |
| Timeline |
| Harel Insurance Inve |
| Gencell |
Harel Insurance and Gencell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and Gencell
The main advantage of trading using opposite Harel Insurance and Gencell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, Gencell 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 Gencell will offset losses from the drop in Gencell's long position.| Harel Insurance vs. Bank Hapoalim | Harel Insurance vs. Israel Discount Bank | Harel Insurance vs. Mizrahi Tefahot | Harel Insurance vs. Bezeq Israeli Telecommunication |
| Gencell vs. Iargento Hi Tech | Gencell vs. Retailors | Gencell vs. Ilex Medical | Gencell vs. Harel Insurance Investments |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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