Correlation Between Meitav Dash and Computer Direct
Can any of the company-specific risk be diversified away by investing in both Meitav Dash and Computer Direct 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 Meitav Dash and Computer Direct into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meitav Dash Investments and Computer Direct, you can compare the effects of market volatilities on Meitav Dash and Computer Direct 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 Meitav Dash with a short position of Computer Direct. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meitav Dash and Computer Direct.
Diversification Opportunities for Meitav Dash and Computer Direct
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Meitav and Computer is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Meitav Dash Investments and Computer Direct in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Direct and Meitav Dash 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 Meitav Dash Investments are associated (or correlated) with Computer Direct. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Direct has no effect on the direction of Meitav Dash i.e., Meitav Dash and Computer Direct go up and down completely randomly.
Pair Corralation between Meitav Dash and Computer Direct
Assuming the 90 days trading horizon Meitav Dash Investments is expected to generate 0.91 times more return on investment than Computer Direct. However, Meitav Dash Investments is 1.1 times less risky than Computer Direct. It trades about 0.76 of its potential returns per unit of risk. Computer Direct is currently generating about 0.59 per unit of risk. If you would invest 191,200 in Meitav Dash Investments on August 25, 2024 and sell it today you would earn a total of 48,800 from holding Meitav Dash Investments or generate 25.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meitav Dash Investments vs. Computer Direct
Performance |
| Timeline |
| Meitav Dash Investments |
| Computer Direct |
Meitav Dash and Computer Direct Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meitav Dash and Computer Direct
The main advantage of trading using opposite Meitav Dash and Computer Direct positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meitav Dash position performs unexpectedly, Computer Direct 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 Computer Direct will offset losses from the drop in Computer Direct's long position.| Meitav Dash vs. One Software Technologies | Meitav Dash vs. YH Dimri Construction | Meitav Dash vs. Suny Cellular Communication | Meitav Dash vs. First International Bank |
| Computer Direct vs. Matrix | Computer Direct vs. Hilan | Computer Direct vs. One Software Technologies | Computer Direct vs. Atreyu Capital Markets |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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