Correlation Between Jerusalem and Intercure
Can any of the company-specific risk be diversified away by investing in both Jerusalem and Intercure 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 Jerusalem and Intercure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jerusalem and Intercure, you can compare the effects of market volatilities on Jerusalem and Intercure 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 Jerusalem with a short position of Intercure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jerusalem and Intercure.
Diversification Opportunities for Jerusalem and Intercure
Pay attention - limited upside
The 3 months correlation between Jerusalem and Intercure is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Jerusalem and Intercure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intercure and Jerusalem 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 Jerusalem are associated (or correlated) with Intercure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intercure has no effect on the direction of Jerusalem i.e., Jerusalem and Intercure go up and down completely randomly.
Pair Corralation between Jerusalem and Intercure
Assuming the 90 days trading horizon Jerusalem is expected to generate 0.46 times more return on investment than Intercure. However, Jerusalem is 2.17 times less risky than Intercure. It trades about 0.19 of its potential returns per unit of risk. Intercure is currently generating about -0.22 per unit of risk. If you would invest 121,115 in Jerusalem on August 29, 2024 and sell it today you would earn a total of 39,685 from holding Jerusalem or generate 32.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jerusalem vs. Intercure
Performance |
| Timeline |
| Jerusalem |
| Intercure |
Jerusalem and Intercure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jerusalem and Intercure
The main advantage of trading using opposite Jerusalem and Intercure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jerusalem position performs unexpectedly, Intercure 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 Intercure will offset losses from the drop in Intercure's long position.| Jerusalem vs. Mizrahi Tefahot | Jerusalem vs. First International Bank | Jerusalem vs. Israel Discount Bank | Jerusalem vs. Bank Leumi Le Israel |
| Intercure vs. Together Startup Network | Intercure vs. Delek Group | Intercure vs. Teva Pharmaceutical Industries | Intercure vs. El Al Israel |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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