Correlation Between Multi Retail and Danel
Can any of the company-specific risk be diversified away by investing in both Multi Retail and Danel 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 Multi Retail and Danel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Retail Group and Danel, you can compare the effects of market volatilities on Multi Retail and Danel 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 Multi Retail with a short position of Danel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Retail and Danel.
Diversification Opportunities for Multi Retail and Danel
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Multi and Danel is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Multi Retail Group and Danel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Danel and Multi Retail 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 Multi Retail Group are associated (or correlated) with Danel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Danel has no effect on the direction of Multi Retail i.e., Multi Retail and Danel go up and down completely randomly.
Pair Corralation between Multi Retail and Danel
Assuming the 90 days trading horizon Multi Retail Group is expected to under-perform the Danel. In addition to that, Multi Retail is 1.32 times more volatile than Danel. It trades about -0.01 of its total potential returns per unit of risk. Danel is currently generating about 0.09 per unit of volatility. If you would invest 4,122,000 in Danel on November 27, 2024 and sell it today you would earn a total of 101,000 from holding Danel or generate 2.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Retail Group vs. Danel
Performance |
| Timeline |
| Multi Retail Group |
| Danel |
Multi Retail and Danel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Retail and Danel
The main advantage of trading using opposite Multi Retail and Danel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Retail position performs unexpectedly, Danel 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 Danel will offset losses from the drop in Danel's long position.| Multi Retail vs. Migdal Insurance | Multi Retail vs. Payment Financial Technologies | Multi Retail vs. Altshuler Shaham Financial | Multi Retail vs. Inrom Construction Industries |
| Danel vs. Hilan | Danel vs. Fattal 1998 Holdings | Danel vs. Matrix | Danel vs. Bezeq Israeli Telecommunication |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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