Correlation Between Phoenix Holdings and El Mor
Can any of the company-specific risk be diversified away by investing in both Phoenix Holdings and El Mor 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 El Mor 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 El Mor Electric Installation, you can compare the effects of market volatilities on Phoenix Holdings and El Mor 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 El Mor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Holdings and El Mor.
Diversification Opportunities for Phoenix Holdings and El Mor
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Phoenix and ELMR is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding The Phoenix Holdings and El Mor Electric Installation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on El Mor Electric 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 El Mor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of El Mor Electric has no effect on the direction of Phoenix Holdings i.e., Phoenix Holdings and El Mor go up and down completely randomly.
Pair Corralation between Phoenix Holdings and El Mor
Assuming the 90 days trading horizon The Phoenix Holdings is expected to generate 1.05 times more return on investment than El Mor. However, Phoenix Holdings is 1.05 times more volatile than El Mor Electric Installation. It trades about 0.05 of its potential returns per unit of risk. El Mor Electric Installation is currently generating about 0.04 per unit of risk. If you would invest 370,252 in The Phoenix Holdings on September 1, 2024 and sell it today you would earn a total of 83,748 from holding The Phoenix Holdings or generate 22.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Phoenix Holdings vs. El Mor Electric Installation
Performance |
| Timeline |
| Phoenix Holdings |
| El Mor Electric |
Phoenix Holdings and El Mor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Holdings and El Mor
The main advantage of trading using opposite Phoenix Holdings and El Mor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Holdings position performs unexpectedly, El Mor 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 El Mor will offset losses from the drop in El Mor'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 |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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