Correlation Between Harel Insurance and Zur Shamir
Can any of the company-specific risk be diversified away by investing in both Harel Insurance and Zur Shamir 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 Zur Shamir 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 Zur Shamir Holdings, you can compare the effects of market volatilities on Harel Insurance and Zur Shamir 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 Zur Shamir. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harel Insurance and Zur Shamir.
Diversification Opportunities for Harel Insurance and Zur Shamir
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Harel and Zur is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Harel Insurance Investments and Zur Shamir Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zur Shamir 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 Zur Shamir. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zur Shamir Holdings has no effect on the direction of Harel Insurance i.e., Harel Insurance and Zur Shamir go up and down completely randomly.
Pair Corralation between Harel Insurance and Zur Shamir
Assuming the 90 days trading horizon Harel Insurance Investments is expected to generate 1.14 times more return on investment than Zur Shamir. However, Harel Insurance is 1.14 times more volatile than Zur Shamir Holdings. It trades about 0.6 of its potential returns per unit of risk. Zur Shamir Holdings is currently generating about 0.48 per unit of risk. If you would invest 364,100 in Harel Insurance Investments on August 29, 2024 and sell it today you would earn a total of 70,400 from holding Harel Insurance Investments or generate 19.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
Harel Insurance Investments vs. Zur Shamir Holdings
Performance |
| Timeline |
| Harel Insurance Inve |
| Zur Shamir Holdings |
Harel Insurance and Zur Shamir Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harel Insurance and Zur Shamir
The main advantage of trading using opposite Harel Insurance and Zur Shamir positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harel Insurance position performs unexpectedly, Zur Shamir 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 Zur Shamir will offset losses from the drop in Zur Shamir's long position.| Harel Insurance vs. Elbit Systems | Harel Insurance vs. Discount Investment Corp | Harel Insurance vs. Clal Insurance Enterprises | Harel Insurance vs. AudioCodes |
| Zur Shamir vs. IDI Insurance | Zur Shamir vs. Adgar Investments and | Zur Shamir vs. Harel Insurance Investments | Zur Shamir vs. Shikun Binui |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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