Correlation Between Payment Financial and Ormat Technologies
Can any of the company-specific risk be diversified away by investing in both Payment Financial and Ormat Technologies 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 Payment Financial and Ormat Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Payment Financial Technologies and Ormat Technologies, you can compare the effects of market volatilities on Payment Financial and Ormat Technologies 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 Payment Financial with a short position of Ormat Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Payment Financial and Ormat Technologies.
Diversification Opportunities for Payment Financial and Ormat Technologies
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Payment and Ormat is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Payment Financial Technologies and Ormat Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ormat Technologies and Payment Financial 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 Payment Financial Technologies are associated (or correlated) with Ormat Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ormat Technologies has no effect on the direction of Payment Financial i.e., Payment Financial and Ormat Technologies go up and down completely randomly.
Pair Corralation between Payment Financial and Ormat Technologies
Assuming the 90 days trading horizon Payment Financial Technologies is expected to generate 1.78 times more return on investment than Ormat Technologies. However, Payment Financial is 1.78 times more volatile than Ormat Technologies. It trades about 0.02 of its potential returns per unit of risk. Ormat Technologies is currently generating about 0.0 per unit of risk. If you would invest 30,332 in Payment Financial Technologies on August 27, 2024 and sell it today you would earn a total of 2,798 from holding Payment Financial Technologies or generate 9.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Payment Financial Technologies vs. Ormat Technologies
Performance |
| Timeline |
| Payment Financial |
| Ormat Technologies |
Payment Financial and Ormat Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Payment Financial and Ormat Technologies
The main advantage of trading using opposite Payment Financial and Ormat Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Payment Financial position performs unexpectedly, Ormat Technologies 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 Ormat Technologies will offset losses from the drop in Ormat Technologies' long position.| Payment Financial vs. Unitronics | Payment Financial vs. PCB Tec | Payment Financial vs. Tower Semiconductor | Payment Financial vs. Priortech |
| Ormat Technologies vs. Elbit Systems | Ormat Technologies vs. Nice | Ormat Technologies vs. Tower Semiconductor | Ormat Technologies vs. Nova |
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.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |