Correlation Between Menif Financial and Bank Leumi
Can any of the company-specific risk be diversified away by investing in both Menif Financial and Bank Leumi 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 Menif Financial and Bank Leumi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Menif Financial Services and Bank Leumi Le Israel, you can compare the effects of market volatilities on Menif Financial and Bank Leumi 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 Menif Financial with a short position of Bank Leumi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Menif Financial and Bank Leumi.
Diversification Opportunities for Menif Financial and Bank Leumi
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Menif and Bank is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Menif Financial Services and Bank Leumi Le Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Leumi Le and Menif Financial 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 Menif Financial Services are associated (or correlated) with Bank Leumi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Leumi Le has no effect on the direction of Menif Financial i.e., Menif Financial and Bank Leumi go up and down completely randomly.
Pair Corralation between Menif Financial and Bank Leumi
Assuming the 90 days trading horizon Menif Financial is expected to generate 3.12 times less return on investment than Bank Leumi. In addition to that, Menif Financial is 1.88 times more volatile than Bank Leumi Le Israel. It trades about 0.07 of its total potential returns per unit of risk. Bank Leumi Le Israel is currently generating about 0.41 per unit of volatility. If you would invest 377,938 in Bank Leumi Le Israel on September 3, 2024 and sell it today you would earn a total of 35,062 from holding Bank Leumi Le Israel or generate 9.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Menif Financial Services vs. Bank Leumi Le Israel
Performance |
| Timeline |
| Menif Financial Services |
| Bank Leumi Le |
Menif Financial and Bank Leumi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Menif Financial and Bank Leumi
The main advantage of trading using opposite Menif Financial and Bank Leumi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Menif Financial position performs unexpectedly, Bank Leumi 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 Bank Leumi will offset losses from the drop in Bank Leumi's long position.| 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 |
| Bank Leumi vs. Bank Hapoalim | Bank Leumi vs. Israel Discount Bank | Bank Leumi vs. First International Bank | Bank Leumi vs. Elbit Systems |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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