Correlation Between Kamada and El Al
Can any of the company-specific risk be diversified away by investing in both Kamada and El Al 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 Kamada and El Al into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kamada and El Al Israel, you can compare the effects of market volatilities on Kamada and El Al 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 Kamada with a short position of El Al. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kamada and El Al.
Diversification Opportunities for Kamada and El Al
Very weak diversification
The 3 months correlation between Kamada and ELAL is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Kamada and El Al Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on El Al Israel and Kamada 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 Kamada are associated (or correlated) with El Al. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of El Al Israel has no effect on the direction of Kamada i.e., Kamada and El Al go up and down completely randomly.
Pair Corralation between Kamada and El Al
Assuming the 90 days trading horizon Kamada is expected to generate 0.48 times more return on investment than El Al. However, Kamada is 2.09 times less risky than El Al. It trades about 0.06 of its potential returns per unit of risk. El Al Israel is currently generating about -0.07 per unit of risk. If you would invest 206,200 in Kamada on August 31, 2024 and sell it today you would earn a total of 4,400 from holding Kamada or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Kamada vs. El Al Israel
Performance |
| Timeline |
| Kamada |
| El Al Israel |
Kamada and El Al Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kamada and El Al
The main advantage of trading using opposite Kamada and El Al positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kamada position performs unexpectedly, El Al 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 El Al will offset losses from the drop in El Al's long position.| Kamada vs. Kamada | Kamada vs. Teva Pharmaceutical Industries | Kamada vs. Tower Semiconductor | Kamada vs. Elbit Systems |
| El Al vs. Delek Group | El Al vs. Teva Pharmaceutical Industries | El Al vs. Fattal 1998 Holdings | El Al vs. Bank Leumi Le 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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