Correlation Between Mizrahi Tefahot and Gold Bond
Can any of the company-specific risk be diversified away by investing in both Mizrahi Tefahot and Gold Bond 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 Mizrahi Tefahot and Gold Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mizrahi Tefahot and The Gold Bond, you can compare the effects of market volatilities on Mizrahi Tefahot and Gold Bond 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 Mizrahi Tefahot with a short position of Gold Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mizrahi Tefahot and Gold Bond.
Diversification Opportunities for Mizrahi Tefahot and Gold Bond
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mizrahi and Gold is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Mizrahi Tefahot and The Gold Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Bond and Mizrahi Tefahot 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 Mizrahi Tefahot are associated (or correlated) with Gold Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Bond has no effect on the direction of Mizrahi Tefahot i.e., Mizrahi Tefahot and Gold Bond go up and down completely randomly.
Pair Corralation between Mizrahi Tefahot and Gold Bond
Assuming the 90 days trading horizon Mizrahi Tefahot is expected to generate 0.57 times more return on investment than Gold Bond. However, Mizrahi Tefahot is 1.76 times less risky than Gold Bond. It trades about 0.26 of its potential returns per unit of risk. The Gold Bond is currently generating about 0.14 per unit of risk. If you would invest 1,385,000 in Mizrahi Tefahot on August 29, 2024 and sell it today you would earn a total of 254,000 from holding Mizrahi Tefahot or generate 18.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mizrahi Tefahot vs. The Gold Bond
Performance |
| Timeline |
| Mizrahi Tefahot |
| Gold Bond |
Mizrahi Tefahot and Gold Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mizrahi Tefahot and Gold Bond
The main advantage of trading using opposite Mizrahi Tefahot and Gold Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mizrahi Tefahot position performs unexpectedly, Gold Bond 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 Gold Bond will offset losses from the drop in Gold Bond's long position.| Mizrahi Tefahot vs. Bank Leumi Le Israel | Mizrahi Tefahot vs. Bank Hapoalim | Mizrahi Tefahot vs. Israel Discount Bank | Mizrahi Tefahot vs. First International Bank |
| Gold Bond vs. Big Shopping Centers | Gold Bond vs. Al Bad Massuot Yitzhak | Gold Bond vs. Harel Insurance Investments | Gold Bond vs. Palram |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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