Correlation Between Inbar Group and Hod Assaf
Can any of the company-specific risk be diversified away by investing in both Inbar Group and Hod Assaf 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 Inbar Group and Hod Assaf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inbar Group Finance and Hod Assaf Industries, you can compare the effects of market volatilities on Inbar Group and Hod Assaf 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 Inbar Group with a short position of Hod Assaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inbar Group and Hod Assaf.
Diversification Opportunities for Inbar Group and Hod Assaf
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inbar and Hod is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Inbar Group Finance and Hod Assaf Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hod Assaf Industries and Inbar Group 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 Inbar Group Finance are associated (or correlated) with Hod Assaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hod Assaf Industries has no effect on the direction of Inbar Group i.e., Inbar Group and Hod Assaf go up and down completely randomly.
Pair Corralation between Inbar Group and Hod Assaf
Assuming the 90 days trading horizon Inbar Group Finance is expected to generate 3.02 times more return on investment than Hod Assaf. However, Inbar Group is 3.02 times more volatile than Hod Assaf Industries. It trades about 0.19 of its potential returns per unit of risk. Hod Assaf Industries is currently generating about 0.36 per unit of risk. If you would invest 27,550 in Inbar Group Finance on August 28, 2024 and sell it today you would earn a total of 5,590 from holding Inbar Group Finance or generate 20.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.43% |
| Values | Daily Returns |
Inbar Group Finance vs. Hod Assaf Industries
Performance |
| Timeline |
| Inbar Group Finance |
| Hod Assaf Industries |
Inbar Group and Hod Assaf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inbar Group and Hod Assaf
The main advantage of trading using opposite Inbar Group and Hod Assaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inbar Group position performs unexpectedly, Hod Assaf 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 Hod Assaf will offset losses from the drop in Hod Assaf's long position.| Inbar Group vs. Atreyu Capital Markets | Inbar Group vs. Poalim Ibi | Inbar Group vs. Value Capital One | Inbar Group vs. Elco |
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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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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