Correlation Between Phoenix Holdings and Elbit Systems
Can any of the company-specific risk be diversified away by investing in both Phoenix Holdings and Elbit Systems 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 Elbit Systems 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 Elbit Systems, you can compare the effects of market volatilities on Phoenix Holdings and Elbit Systems 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 Elbit Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Holdings and Elbit Systems.
Diversification Opportunities for Phoenix Holdings and Elbit Systems
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Phoenix and Elbit is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding The Phoenix Holdings and Elbit Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elbit Systems 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 Elbit Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elbit Systems has no effect on the direction of Phoenix Holdings i.e., Phoenix Holdings and Elbit Systems go up and down completely randomly.
Pair Corralation between Phoenix Holdings and Elbit Systems
Assuming the 90 days trading horizon The Phoenix Holdings is expected to generate 0.59 times more return on investment than Elbit Systems. However, The Phoenix Holdings is 1.69 times less risky than Elbit Systems. It trades about 0.63 of its potential returns per unit of risk. Elbit Systems is currently generating about 0.25 per unit of risk. If you would invest 413,500 in The Phoenix Holdings on August 24, 2024 and sell it today you would earn a total of 51,900 from holding The Phoenix Holdings or generate 12.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Phoenix Holdings vs. Elbit Systems
Performance |
| Timeline |
| Phoenix Holdings |
| Elbit Systems |
Phoenix Holdings and Elbit Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Holdings and Elbit Systems
The main advantage of trading using opposite Phoenix Holdings and Elbit Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Holdings position performs unexpectedly, Elbit Systems 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 Elbit Systems will offset losses from the drop in Elbit Systems' 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 |
| Elbit Systems vs. Nice | Elbit Systems vs. Bank Leumi Le Israel | Elbit Systems vs. Teva Pharmaceutical Industries | Elbit Systems 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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