Correlation Between Harel Insurance and Phoenix Holdings
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and Phoenix Holdings 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 Phoenix Holdings 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 The Phoenix Holdings, you can compare the effects of market volatilities on Harel Insurance and Phoenix Holdings 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 Phoenix Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and Phoenix Holdings.
Diversification Opportunities for Harel Insurance and Phoenix Holdings
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Harel and Phoenix is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and The Phoenix Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phoenix Holdings 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 Phoenix Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phoenix Holdings has no effect on the direction of Harel Insurance i.e., Harel Insurance and Phoenix Holdings go up and down completely randomly.
Pair Corralation between Harel Insurance and Phoenix Holdings
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 1.43 times more return on investment than Phoenix Holdings. However, Harel Insurance is 1.43 times more volatile than The Phoenix Holdings. It trades about 0.56 of its potential returns per unit of risk. The Phoenix Holdings is currently generating about 0.65 per unit of risk. If you would invest 364,100 in Harel Insurance Investments on August 24, 2024 and sell it today you would earn a total of 55,900 from holding Harel Insurance Investments or generate 15.35% 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. The Phoenix Holdings
Performance |
| Timeline |
| Harel Insurance Inve |
| Phoenix Holdings |
Harel Insurance and Phoenix Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and Phoenix Holdings
The main advantage of trading using opposite Harel Insurance and Phoenix Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, Phoenix Holdings 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 Phoenix Holdings will offset losses from the drop in Phoenix Holdings' long position.| Harel Insurance vs. Migdal Insurance | Harel Insurance vs. Clal Insurance Enterprises | Harel Insurance vs. Bank Hapoalim | Harel Insurance vs. Bank Leumi Le Israel |
| Phoenix Holdings vs. Harel Insurance Investments | Phoenix Holdings vs. Migdal Insurance | Phoenix Holdings vs. Menora Miv Hld | Phoenix Holdings 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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