Correlation Between Nawi Brothers and Isracard
Can any of the company-specific risk be diversified away by investing in both Nawi Brothers and Isracard 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 Nawi Brothers and Isracard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nawi Brothers Group and Isracard, you can compare the effects of market volatilities on Nawi Brothers and Isracard 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 Nawi Brothers with a short position of Isracard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nawi Brothers and Isracard.
Diversification Opportunities for Nawi Brothers and Isracard
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Nawi and Isracard is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Nawi Brothers Group and Isracard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Isracard and Nawi Brothers 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 Nawi Brothers Group are associated (or correlated) with Isracard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Isracard has no effect on the direction of Nawi Brothers i.e., Nawi Brothers and Isracard go up and down completely randomly.
Pair Corralation between Nawi Brothers and Isracard
Assuming the 90 days trading horizon Nawi Brothers Group is expected to generate 0.84 times more return on investment than Isracard. However, Nawi Brothers Group is 1.19 times less risky than Isracard. It trades about 0.12 of its potential returns per unit of risk. Isracard is currently generating about 0.05 per unit of risk. If you would invest 210,783 in Nawi Brothers Group on November 19, 2024 and sell it today you would earn a total of 246,017 from holding Nawi Brothers Group or generate 116.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nawi Brothers Group vs. Isracard
Performance |
| Timeline |
| Nawi Brothers Group |
| Isracard |
Nawi Brothers and Isracard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nawi Brothers and Isracard
The main advantage of trading using opposite Nawi Brothers and Isracard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nawi Brothers position performs unexpectedly, Isracard 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 Isracard will offset losses from the drop in Isracard's long position.| Nawi Brothers vs. Isracard | Nawi Brothers vs. Bank Hapoalim | Nawi Brothers vs. Tadiran Hldg | Nawi Brothers vs. Mizrahi Tefahot |
| Isracard vs. Bank Hapoalim | Isracard vs. Bank Leumi Le Israel | Isracard vs. Mizrahi Tefahot | Isracard vs. Israel Discount Bank |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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