Correlation Between Poalim Ibi and Shaniv
Can any of the company-specific risk be diversified away by investing in both Poalim Ibi and Shaniv 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 Poalim Ibi and Shaniv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Poalim Ibi and Shaniv, you can compare the effects of market volatilities on Poalim Ibi and Shaniv 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 Poalim Ibi with a short position of Shaniv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Poalim Ibi and Shaniv.
Diversification Opportunities for Poalim Ibi and Shaniv
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Poalim and Shaniv is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Poalim Ibi and Shaniv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaniv and Poalim Ibi 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 Poalim Ibi are associated (or correlated) with Shaniv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaniv has no effect on the direction of Poalim Ibi i.e., Poalim Ibi and Shaniv go up and down completely randomly.
Pair Corralation between Poalim Ibi and Shaniv
Assuming the 90 days trading horizon Poalim Ibi is expected to generate 1.43 times more return on investment than Shaniv. However, Poalim Ibi is 1.43 times more volatile than Shaniv. It trades about 0.01 of its potential returns per unit of risk. Shaniv is currently generating about 0.01 per unit of risk. If you would invest 68,000 in Poalim Ibi on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Poalim Ibi or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Poalim Ibi vs. Shaniv
Performance |
| Timeline |
| Poalim Ibi |
| Shaniv |
Poalim Ibi and Shaniv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Poalim Ibi and Shaniv
The main advantage of trading using opposite Poalim Ibi and Shaniv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Poalim Ibi position performs unexpectedly, Shaniv 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 Shaniv will offset losses from the drop in Shaniv's long position.| Poalim Ibi vs. Elbit Systems | Poalim Ibi vs. Discount Investment Corp | Poalim Ibi vs. Clal Insurance Enterprises | Poalim Ibi vs. AudioCodes |
| Shaniv vs. Rapac Communication Infrastructure | Shaniv vs. Shufersal | Shaniv vs. Palram | Shaniv vs. Nawi Brothers Group |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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