Correlation Between Peninsula and Shikun Binui
Can any of the company-specific risk be diversified away by investing in both Peninsula and Shikun Binui 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 Peninsula and Shikun Binui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peninsula Group and Shikun Binui, you can compare the effects of market volatilities on Peninsula and Shikun Binui 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 Peninsula with a short position of Shikun Binui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peninsula and Shikun Binui.
Diversification Opportunities for Peninsula and Shikun Binui
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Peninsula and Shikun is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Peninsula Group and Shikun Binui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shikun Binui and Peninsula 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 Peninsula Group are associated (or correlated) with Shikun Binui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shikun Binui has no effect on the direction of Peninsula i.e., Peninsula and Shikun Binui go up and down completely randomly.
Pair Corralation between Peninsula and Shikun Binui
Assuming the 90 days trading horizon Peninsula Group is expected to generate 0.66 times more return on investment than Shikun Binui. However, Peninsula Group is 1.52 times less risky than Shikun Binui. It trades about 0.05 of its potential returns per unit of risk. Shikun Binui is currently generating about 0.02 per unit of risk. If you would invest 14,674 in Peninsula Group on September 1, 2024 and sell it today you would earn a total of 5,756 from holding Peninsula Group or generate 39.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peninsula Group vs. Shikun Binui
Performance |
| Timeline |
| Peninsula Group |
| Shikun Binui |
Peninsula and Shikun Binui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peninsula and Shikun Binui
The main advantage of trading using opposite Peninsula and Shikun Binui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peninsula position performs unexpectedly, Shikun Binui 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 Shikun Binui will offset losses from the drop in Shikun Binui's long position.| Peninsula vs. Opal Balance | Peninsula vs. Nawi Brothers Group | Peninsula vs. Mizrahi Tefahot | Peninsula vs. SR Accord |
| Shikun Binui vs. Israel Discount Bank | Shikun Binui vs. Bezeq Israeli Telecommunication | Shikun Binui vs. Azrieli Group | Shikun Binui vs. Bank Hapoalim |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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