Correlation Between Oron Group and B Communications
Can any of the company-specific risk be diversified away by investing in both Oron Group and B Communications 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 Oron Group and B Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oron Group Investments and B Communications, you can compare the effects of market volatilities on Oron Group and B Communications 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 Oron Group with a short position of B Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oron Group and B Communications.
Diversification Opportunities for Oron Group and B Communications
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Oron and BCOM is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Oron Group Investments and B Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on B Communications and Oron Group 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 Oron Group Investments are associated (or correlated) with B Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of B Communications has no effect on the direction of Oron Group i.e., Oron Group and B Communications go up and down completely randomly.
Pair Corralation between Oron Group and B Communications
Assuming the 90 days trading horizon Oron Group is expected to generate 39.76 times less return on investment than B Communications. But when comparing it to its historical volatility, Oron Group Investments is 1.62 times less risky than B Communications. It trades about 0.02 of its potential returns per unit of risk. B Communications is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 130,000 in B Communications on August 29, 2024 and sell it today you would earn a total of 38,100 from holding B Communications or generate 29.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oron Group Investments vs. B Communications
Performance |
| Timeline |
| Oron Group Investments |
| B Communications |
Oron Group and B Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oron Group and B Communications
The main advantage of trading using opposite Oron Group and B Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oron Group position performs unexpectedly, B Communications 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 B Communications will offset losses from the drop in B Communications' long position.| Oron Group vs. Ormat Technologies | Oron Group vs. Multi Retail Group | Oron Group vs. Nova | Oron Group vs. B Communications |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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