Correlation Between Isras Investment and Arena Star
Can any of the company-specific risk be diversified away by investing in both Isras Investment and Arena Star 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 Isras Investment and Arena Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Isras Investment and Arena Star Group, you can compare the effects of market volatilities on Isras Investment and Arena Star 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 Isras Investment with a short position of Arena Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Isras Investment and Arena Star.
Diversification Opportunities for Isras Investment and Arena Star
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Isras and Arena is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Isras Investment and Arena Star Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arena Star Group and Isras Investment 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 Isras Investment are associated (or correlated) with Arena Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arena Star Group has no effect on the direction of Isras Investment i.e., Isras Investment and Arena Star go up and down completely randomly.
Pair Corralation between Isras Investment and Arena Star
Assuming the 90 days trading horizon Isras Investment is expected to generate 0.71 times more return on investment than Arena Star. However, Isras Investment is 1.41 times less risky than Arena Star. It trades about 0.08 of its potential returns per unit of risk. Arena Star Group is currently generating about 0.03 per unit of risk. If you would invest 6,489,333 in Isras Investment on September 12, 2024 and sell it today you would earn a total of 2,470,667 from holding Isras Investment or generate 38.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Isras Investment vs. Arena Star Group
Performance |
| Timeline |
| Isras Investment |
| Arena Star Group |
Isras Investment and Arena Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Isras Investment and Arena Star
The main advantage of trading using opposite Isras Investment and Arena Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Isras Investment position performs unexpectedly, Arena Star 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 Arena Star will offset losses from the drop in Arena Star's long position.| Isras Investment vs. Alony Hetz Properties | Isras Investment vs. Fox Wizel | Isras Investment vs. Amot Investments | Isras Investment vs. Harel Insurance Investments |
| Arena Star vs. Isras Investment | Arena Star vs. Sella Real Estate | Arena Star vs. Harel Insurance Investments | Arena Star vs. B Communications |
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 Stocks Directory module to find actively traded stocks across global markets.
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