Correlation Between Bank Leumi and Menif Financial
Can any of the company-specific risk be diversified away by investing in both Bank Leumi and Menif Financial 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 Menif Financial 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 Menif Financial Services, you can compare the effects of market volatilities on Bank Leumi and Menif Financial 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 Menif Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Leumi and Menif Financial.
Diversification Opportunities for Bank Leumi and Menif Financial
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bank and Menif is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Bank Leumi Le Israel and Menif Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menif Financial Services 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 Menif Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menif Financial Services has no effect on the direction of Bank Leumi i.e., Bank Leumi and Menif Financial go up and down completely randomly.
Pair Corralation between Bank Leumi and Menif Financial
Assuming the 90 days trading horizon Bank Leumi is expected to generate 1.13 times less return on investment than Menif Financial. But when comparing it to its historical volatility, Bank Leumi Le Israel is 1.32 times less risky than Menif Financial. It trades about 0.24 of its potential returns per unit of risk. Menif Financial Services is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 103,061 in Menif Financial Services on September 3, 2024 and sell it today you would earn a total of 44,939 from holding Menif Financial Services or generate 43.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Leumi Le Israel vs. Menif Financial Services
Performance |
| Timeline |
| Bank Leumi Le |
| Menif Financial Services |
Bank Leumi and Menif Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Leumi and Menif Financial
The main advantage of trading using opposite Bank Leumi and Menif Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Leumi position performs unexpectedly, Menif Financial 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 Menif Financial will offset losses from the drop in Menif Financial's long position.| Bank Leumi vs. Bank Hapoalim | Bank Leumi vs. Israel Discount Bank | Bank Leumi vs. First International Bank | Bank Leumi vs. Elbit Systems |
| Menif Financial vs. Sure Tech Investments LP | Menif Financial vs. Arad Investment Industrial | Menif Financial vs. Oron Group Investments | Menif Financial vs. Harel Insurance Investments |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |