Correlation Between Phoenix Holdings and Ashot Ashkelon
Can any of the company-specific risk be diversified away by investing in both Phoenix Holdings and Ashot Ashkelon 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 Phoenix Holdings and Ashot Ashkelon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Phoenix Holdings and Ashot Ashkelon Industries, you can compare the effects of market volatilities on Phoenix Holdings and Ashot Ashkelon 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 Phoenix Holdings with a short position of Ashot Ashkelon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Holdings and Ashot Ashkelon.
Diversification Opportunities for Phoenix Holdings and Ashot Ashkelon
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Phoenix and Ashot is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding The Phoenix Holdings and Ashot Ashkelon Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashot Ashkelon Industries and Phoenix Holdings 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 The Phoenix Holdings are associated (or correlated) with Ashot Ashkelon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashot Ashkelon Industries has no effect on the direction of Phoenix Holdings i.e., Phoenix Holdings and Ashot Ashkelon go up and down completely randomly.
Pair Corralation between Phoenix Holdings and Ashot Ashkelon
Assuming the 90 days trading horizon The Phoenix Holdings is expected to generate 0.4 times more return on investment than Ashot Ashkelon. However, The Phoenix Holdings is 2.5 times less risky than Ashot Ashkelon. It trades about 0.19 of its potential returns per unit of risk. Ashot Ashkelon Industries is currently generating about -0.14 per unit of risk. If you would invest 433,500 in The Phoenix Holdings on September 1, 2024 and sell it today you would earn a total of 20,500 from holding The Phoenix Holdings or generate 4.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Phoenix Holdings vs. Ashot Ashkelon Industries
Performance |
| Timeline |
| Phoenix Holdings |
| Ashot Ashkelon Industries |
Phoenix Holdings and Ashot Ashkelon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Holdings and Ashot Ashkelon
The main advantage of trading using opposite Phoenix Holdings and Ashot Ashkelon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Holdings position performs unexpectedly, Ashot Ashkelon 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 Ashot Ashkelon will offset losses from the drop in Ashot Ashkelon's long position.| Phoenix Holdings vs. Harel Insurance Investments | Phoenix Holdings vs. Migdal Insurance | Phoenix Holdings vs. Menora Miv Hld | Phoenix Holdings vs. Israel Discount Bank |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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