Correlation Between Phoenix Holdings and Netz Hotels
Can any of the company-specific risk be diversified away by investing in both Phoenix Holdings and Netz Hotels 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 Netz Hotels 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 Netz Hotels, you can compare the effects of market volatilities on Phoenix Holdings and Netz Hotels 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 Netz Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Holdings and Netz Hotels.
Diversification Opportunities for Phoenix Holdings and Netz Hotels
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Phoenix and Netz is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding The Phoenix Holdings and Netz Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netz Hotels 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 Netz Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netz Hotels has no effect on the direction of Phoenix Holdings i.e., Phoenix Holdings and Netz Hotels go up and down completely randomly.
Pair Corralation between Phoenix Holdings and Netz Hotels
Assuming the 90 days trading horizon The Phoenix Holdings is expected to generate 0.29 times more return on investment than Netz Hotels. However, The Phoenix Holdings is 3.47 times less risky than Netz Hotels. It trades about 0.09 of its potential returns per unit of risk. Netz Hotels is currently generating about 0.02 per unit of risk. If you would invest 350,685 in The Phoenix Holdings on August 29, 2024 and sell it today you would earn a total of 125,415 from holding The Phoenix Holdings or generate 35.76% 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. Netz Hotels
Performance |
| Timeline |
| Phoenix Holdings |
| Netz Hotels |
Phoenix Holdings and Netz Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Holdings and Netz Hotels
The main advantage of trading using opposite Phoenix Holdings and Netz Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Holdings position performs unexpectedly, Netz Hotels 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 Netz Hotels will offset losses from the drop in Netz Hotels' 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 |
| Netz Hotels vs. Direct Capital Investments | Netz Hotels vs. Itay Financial AA | Netz Hotels vs. B Communications | Netz Hotels vs. Holmes Place International |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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