Correlation Between Itay Financial and Cohen Dev
Can any of the company-specific risk be diversified away by investing in both Itay Financial and Cohen Dev 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 Itay Financial and Cohen Dev into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Itay Financial AA and Cohen Dev, you can compare the effects of market volatilities on Itay Financial and Cohen Dev 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 Itay Financial with a short position of Cohen Dev. Check out your portfolio center. Please also check ongoing floating volatility patterns of Itay Financial and Cohen Dev.
Diversification Opportunities for Itay Financial and Cohen Dev
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Itay and Cohen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Itay Financial AA and Cohen Dev in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Dev and Itay Financial 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 Itay Financial AA are associated (or correlated) with Cohen Dev. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohen Dev has no effect on the direction of Itay Financial i.e., Itay Financial and Cohen Dev go up and down completely randomly.
Pair Corralation between Itay Financial and Cohen Dev
Assuming the 90 days trading horizon Itay Financial AA is expected to generate 5.78 times more return on investment than Cohen Dev. However, Itay Financial is 5.78 times more volatile than Cohen Dev. It trades about 0.1 of its potential returns per unit of risk. Cohen Dev is currently generating about 0.18 per unit of risk. If you would invest 24,430 in Itay Financial AA on October 22, 2024 and sell it today you would earn a total of 17,570 from holding Itay Financial AA or generate 71.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Itay Financial AA vs. Cohen Dev
Performance |
| Timeline |
| Itay Financial AA |
| Cohen Dev |
Itay Financial and Cohen Dev Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Itay Financial and Cohen Dev
The main advantage of trading using opposite Itay Financial and Cohen Dev positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Itay Financial position performs unexpectedly, Cohen Dev 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 Cohen Dev will offset losses from the drop in Cohen Dev's long position.| Itay Financial vs. Suny Cellular Communication | Itay Financial vs. B Communications | Itay Financial vs. Terminal X Online | Itay Financial vs. Rapac Communication Infrastructure |
| Cohen Dev vs. Atreyu Capital Markets | Cohen Dev vs. IBI Inv House | Cohen Dev vs. Delek Automotive Systems | Cohen Dev vs. Scope Metals Group |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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