Correlation Between Bank Leumi and Fantasy Network
Can any of the company-specific risk be diversified away by investing in both Bank Leumi and Fantasy Network 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 Bank Leumi and Fantasy Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Leumi Le Israel and Fantasy Network, you can compare the effects of market volatilities on Bank Leumi and Fantasy Network 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 Bank Leumi with a short position of Fantasy Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Leumi and Fantasy Network.
Diversification Opportunities for Bank Leumi and Fantasy Network
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bank and Fantasy is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Bank Leumi Le Israel and Fantasy Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fantasy Network and Bank Leumi 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 Bank Leumi Le Israel are associated (or correlated) with Fantasy Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fantasy Network has no effect on the direction of Bank Leumi i.e., Bank Leumi and Fantasy Network go up and down completely randomly.
Pair Corralation between Bank Leumi and Fantasy Network
Assuming the 90 days trading horizon Bank Leumi Le Israel is expected to generate 0.43 times more return on investment than Fantasy Network. However, Bank Leumi Le Israel is 2.33 times less risky than Fantasy Network. It trades about 0.06 of its potential returns per unit of risk. Fantasy Network is currently generating about -0.06 per unit of risk. If you would invest 283,506 in Bank Leumi Le Israel on August 25, 2024 and sell it today you would earn a total of 129,994 from holding Bank Leumi Le Israel or generate 45.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Leumi Le Israel vs. Fantasy Network
Performance |
| Timeline |
| Bank Leumi Le |
| Fantasy Network |
Bank Leumi and Fantasy Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Leumi and Fantasy Network
The main advantage of trading using opposite Bank Leumi and Fantasy Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Leumi position performs unexpectedly, Fantasy Network 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 Fantasy Network will offset losses from the drop in Fantasy Network's long position.| Bank Leumi vs. Bank Hapoalim | Bank Leumi vs. Israel Discount Bank | Bank Leumi vs. Mizrahi Tefahot | Bank Leumi vs. Bezeq Israeli Telecommunication |
| Fantasy Network vs. Terminal X Online | Fantasy Network vs. Harel Insurance Investments | Fantasy Network vs. Opko Health | Fantasy Network vs. Libra Insurance |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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