Correlation Between Harel Insurance and Holmes Place
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and Holmes Place 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 Holmes Place 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 Holmes Place International, you can compare the effects of market volatilities on Harel Insurance and Holmes Place 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 Holmes Place. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and Holmes Place.
Diversification Opportunities for Harel Insurance and Holmes Place
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Harel and Holmes is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and Holmes Place International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holmes Place Interna 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 Holmes Place. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holmes Place Interna has no effect on the direction of Harel Insurance i.e., Harel Insurance and Holmes Place go up and down completely randomly.
Pair Corralation between Harel Insurance and Holmes Place
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 1.13 times more return on investment than Holmes Place. However, Harel Insurance is 1.13 times more volatile than Holmes Place International. It trades about 0.16 of its potential returns per unit of risk. Holmes Place International is currently generating about 0.08 per unit of risk. If you would invest 322,650 in Harel Insurance Investments on September 1, 2024 and sell it today you would earn a total of 115,350 from holding Harel Insurance Investments or generate 35.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harel Insurance Investments vs. Holmes Place International
Performance |
| Timeline |
| Harel Insurance Inve |
| Holmes Place Interna |
Harel Insurance and Holmes Place Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and Holmes Place
The main advantage of trading using opposite Harel Insurance and Holmes Place positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, Holmes Place 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 Holmes Place will offset losses from the drop in Holmes Place'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 |
| Holmes Place vs. Fattal 1998 Holdings | Holmes Place vs. Delek Group | Holmes Place vs. Bank Leumi Le Israel | Holmes Place vs. Matrix |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |