Correlation Between ICL Israel and Abra Information
Can any of the company-specific risk be diversified away by investing in both ICL Israel and Abra Information 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 ICL Israel and Abra Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICL Israel Chemicals and Abra Information Technologies, you can compare the effects of market volatilities on ICL Israel and Abra Information 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 ICL Israel with a short position of Abra Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICL Israel and Abra Information.
Diversification Opportunities for ICL Israel and Abra Information
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ICL and Abra is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding ICL Israel Chemicals and Abra Information Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abra Information Tec and ICL Israel 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 ICL Israel Chemicals are associated (or correlated) with Abra Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abra Information Tec has no effect on the direction of ICL Israel i.e., ICL Israel and Abra Information go up and down completely randomly.
Pair Corralation between ICL Israel and Abra Information
Assuming the 90 days trading horizon ICL Israel is expected to generate 12.97 times less return on investment than Abra Information. In addition to that, ICL Israel is 1.19 times more volatile than Abra Information Technologies. It trades about 0.0 of its total potential returns per unit of risk. Abra Information Technologies is currently generating about 0.06 per unit of volatility. If you would invest 25,340 in Abra Information Technologies on August 30, 2024 and sell it today you would earn a total of 1,360 from holding Abra Information Technologies or generate 5.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICL Israel Chemicals vs. Abra Information Technologies
Performance |
| Timeline |
| ICL Israel Chemicals |
| Abra Information Tec |
ICL Israel and Abra Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICL Israel and Abra Information
The main advantage of trading using opposite ICL Israel and Abra Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICL Israel position performs unexpectedly, Abra Information 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 Abra Information will offset losses from the drop in Abra Information's long position.| ICL Israel vs. Elbit Systems | ICL Israel vs. Bezeq Israeli Telecommunication | ICL Israel vs. Bank Hapoalim | ICL Israel vs. Teva Pharmaceutical Industries |
| Abra Information vs. Harel Insurance Investments | Abra Information vs. Silver Castle Holdings | Abra Information vs. MEITAV INVESTMENTS HOUSE | Abra Information vs. Isras Investment |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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