Correlation Between Jacob Finance and B Communications
Can any of the company-specific risk be diversified away by investing in both Jacob Finance and B Communications 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 Jacob Finance and B Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacob Finance And and B Communications, you can compare the effects of market volatilities on Jacob Finance and B Communications 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 Jacob Finance with a short position of B Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacob Finance and B Communications.
Diversification Opportunities for Jacob Finance and B Communications
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jacob and BCOM is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Jacob Finance And and B Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on B Communications and Jacob Finance 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 Jacob Finance And are associated (or correlated) with B Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of B Communications has no effect on the direction of Jacob Finance i.e., Jacob Finance and B Communications go up and down completely randomly.
Pair Corralation between Jacob Finance and B Communications
Assuming the 90 days trading horizon Jacob Finance And is expected to under-perform the B Communications. But the stock apears to be less risky and, when comparing its historical volatility, Jacob Finance And is 1.58 times less risky than B Communications. The stock trades about -0.07 of its potential returns per unit of risk. The B Communications is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 132,500 in B Communications on September 3, 2024 and sell it today you would earn a total of 34,500 from holding B Communications or generate 26.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacob Finance And vs. B Communications
Performance |
| Timeline |
| Jacob Finance And |
| B Communications |
Jacob Finance and B Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacob Finance and B Communications
The main advantage of trading using opposite Jacob Finance and B Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacob Finance position performs unexpectedly, B Communications 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 B Communications will offset losses from the drop in B Communications' long position.| Jacob Finance vs. B Communications | Jacob Finance vs. Batm Advanced Communications | Jacob Finance vs. Mobile Max M | Jacob Finance vs. Migdal Insurance |
| B Communications vs. Bezeq Israeli Telecommunication | B Communications vs. Cellcom Israel | B Communications vs. Tower Semiconductor | B Communications vs. Israel Discount Bank |
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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