Correlation Between Nova and Issta Lines
Can any of the company-specific risk be diversified away by investing in both Nova and Issta Lines 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 Nova and Issta Lines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nova and Issta Lines, you can compare the effects of market volatilities on Nova and Issta Lines 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 Nova with a short position of Issta Lines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nova and Issta Lines.
Diversification Opportunities for Nova and Issta Lines
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nova and Issta is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Nova and Issta Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Issta Lines and Nova 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 Nova are associated (or correlated) with Issta Lines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Issta Lines has no effect on the direction of Nova i.e., Nova and Issta Lines go up and down completely randomly.
Pair Corralation between Nova and Issta Lines
Assuming the 90 days trading horizon Nova is expected to generate 0.98 times more return on investment than Issta Lines. However, Nova is 1.02 times less risky than Issta Lines. It trades about 0.1 of its potential returns per unit of risk. Issta Lines is currently generating about 0.02 per unit of risk. If you would invest 2,831,000 in Nova on September 13, 2024 and sell it today you would earn a total of 4,015,000 from holding Nova or generate 141.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nova vs. Issta Lines
Performance |
| Timeline |
| Nova |
| Issta Lines |
Nova and Issta Lines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nova and Issta Lines
The main advantage of trading using opposite Nova and Issta Lines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nova position performs unexpectedly, Issta Lines 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 Issta Lines will offset losses from the drop in Issta Lines' long position.The idea behind Nova and Issta Lines pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Issta Lines vs. Fattal 1998 Holdings | Issta Lines vs. Israel Discount Bank | Issta Lines vs. Azrieli Group | Issta Lines vs. Shufersal |
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 CEOs Directory module to screen CEOs from public companies around the world.
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