Correlation Between Israel China and Buff Technologies
Can any of the company-specific risk be diversified away by investing in both Israel China and Buff Technologies 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 Israel China and Buff Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Israel China Biotechnology and Buff Technologies, you can compare the effects of market volatilities on Israel China and Buff Technologies 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 Israel China with a short position of Buff Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Israel China and Buff Technologies.
Diversification Opportunities for Israel China and Buff Technologies
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Israel and Buff is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Israel China Biotechnology and Buff Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buff Technologies and Israel China 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 Israel China Biotechnology are associated (or correlated) with Buff Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buff Technologies has no effect on the direction of Israel China i.e., Israel China and Buff Technologies go up and down completely randomly.
Pair Corralation between Israel China and Buff Technologies
Assuming the 90 days trading horizon Israel China Biotechnology is expected to under-perform the Buff Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Israel China Biotechnology is 1.44 times less risky than Buff Technologies. The stock trades about -0.05 of its potential returns per unit of risk. The Buff Technologies is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 226,100 in Buff Technologies on November 28, 2024 and sell it today you would lose (38,100) from holding Buff Technologies or give up 16.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Israel China Biotechnology vs. Buff Technologies
Performance |
| Timeline |
| Israel China Biotech |
| Buff Technologies |
Israel China and Buff Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Israel China and Buff Technologies
The main advantage of trading using opposite Israel China and Buff Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Israel China position performs unexpectedly, Buff Technologies 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 Buff Technologies will offset losses from the drop in Buff Technologies' long position.| Israel China vs. Bank Leumi Le Israel | Israel China vs. Altshuler Shaham Financial | Israel China vs. Multi Retail Group | Israel China vs. Hiron Trade Investments Industrial |
| Buff Technologies vs. Feat Fund Investments | Buff Technologies vs. Analyst IMS Investment | Buff Technologies vs. Discount Investment Corp | Buff Technologies 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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