Correlation Between Libra Insurance and Willy Food
Can any of the company-specific risk be diversified away by investing in both Libra Insurance and Willy Food 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 Libra Insurance and Willy Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Libra Insurance and Willy Food, you can compare the effects of market volatilities on Libra Insurance and Willy Food 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 Libra Insurance with a short position of Willy Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Libra Insurance and Willy Food.
Diversification Opportunities for Libra Insurance and Willy Food
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Libra and Willy is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Libra Insurance and Willy Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willy Food and Libra Insurance 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 Libra Insurance are associated (or correlated) with Willy Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willy Food has no effect on the direction of Libra Insurance i.e., Libra Insurance and Willy Food go up and down completely randomly.
Pair Corralation between Libra Insurance and Willy Food
Assuming the 90 days trading horizon Libra Insurance is expected to generate 0.96 times more return on investment than Willy Food. However, Libra Insurance is 1.04 times less risky than Willy Food. It trades about 0.09 of its potential returns per unit of risk. Willy Food is currently generating about -0.01 per unit of risk. If you would invest 36,350 in Libra Insurance on August 26, 2024 and sell it today you would earn a total of 45,810 from holding Libra Insurance or generate 126.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Libra Insurance vs. Willy Food
Performance |
| Timeline |
| Libra Insurance |
| Willy Food |
Libra Insurance and Willy Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Libra Insurance and Willy Food
The main advantage of trading using opposite Libra Insurance and Willy Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Libra Insurance position performs unexpectedly, Willy Food 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 Willy Food will offset losses from the drop in Willy Food's long position.| Libra Insurance vs. Elbit Medical Technologies | Libra Insurance vs. Victory Supermarket Chain | Libra Insurance vs. Terminal X Online | Libra Insurance vs. Azorim Investment Development |
| Willy Food vs. Rami Levi | Willy Food vs. Neto ME Holdings | Willy Food vs. Shufersal | Willy Food vs. Strauss 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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