Correlation Between Meitav Dash and Israel Corp
Can any of the company-specific risk be diversified away by investing in both Meitav Dash and Israel Corp 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 Israel Corp 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 Israel Corp, you can compare the effects of market volatilities on Meitav Dash and Israel Corp 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 Israel Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meitav Dash and Israel Corp.
Diversification Opportunities for Meitav Dash and Israel Corp
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Meitav and Israel is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Meitav Dash Investments and Israel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Israel Corp 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 Israel Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Israel Corp has no effect on the direction of Meitav Dash i.e., Meitav Dash and Israel Corp go up and down completely randomly.
Pair Corralation between Meitav Dash and Israel Corp
Assuming the 90 days trading horizon Meitav Dash Investments is expected to generate 0.89 times more return on investment than Israel Corp. However, Meitav Dash Investments is 1.12 times less risky than Israel Corp. It trades about 0.19 of its potential returns per unit of risk. Israel Corp is currently generating about 0.0 per unit of risk. If you would invest 128,400 in Meitav Dash Investments on September 3, 2024 and sell it today you would earn a total of 140,700 from holding Meitav Dash Investments or generate 109.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meitav Dash Investments vs. Israel Corp
Performance |
| Timeline |
| Meitav Dash Investments |
| Israel Corp |
Meitav Dash and Israel Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meitav Dash and Israel Corp
The main advantage of trading using opposite Meitav Dash and Israel Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meitav Dash position performs unexpectedly, Israel Corp 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 Israel Corp will offset losses from the drop in Israel Corp's long position.| Meitav Dash vs. Bank Hapoalim | Meitav Dash vs. Israel Discount Bank | Meitav Dash vs. First International Bank | Meitav Dash vs. Elbit Systems |
| Israel Corp vs. Harel Insurance Investments | Israel Corp vs. Skyline Investments | Israel Corp vs. Batm Advanced Communications | Israel Corp vs. MediPress Health Limited Partnership |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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