Correlation Between Polyram Plastic and Bank Leumi
Can any of the company-specific risk be diversified away by investing in both Polyram Plastic and Bank Leumi 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 Polyram Plastic and Bank Leumi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polyram Plastic Industries and Bank Leumi Le Israel, you can compare the effects of market volatilities on Polyram Plastic and Bank Leumi 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 Polyram Plastic with a short position of Bank Leumi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polyram Plastic and Bank Leumi.
Diversification Opportunities for Polyram Plastic and Bank Leumi
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Polyram and Bank is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Polyram Plastic Industries and Bank Leumi Le Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Leumi Le and Polyram Plastic 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 Polyram Plastic Industries are associated (or correlated) with Bank Leumi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Leumi Le has no effect on the direction of Polyram Plastic i.e., Polyram Plastic and Bank Leumi go up and down completely randomly.
Pair Corralation between Polyram Plastic and Bank Leumi
Assuming the 90 days trading horizon Polyram Plastic Industries is expected to generate 1.7 times more return on investment than Bank Leumi. However, Polyram Plastic is 1.7 times more volatile than Bank Leumi Le Israel. It trades about 0.42 of its potential returns per unit of risk. Bank Leumi Le Israel is currently generating about 0.41 per unit of risk. If you would invest 114,188 in Polyram Plastic Industries on September 1, 2024 and sell it today you would earn a total of 18,212 from holding Polyram Plastic Industries or generate 15.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.44% |
| Values | Daily Returns |
Polyram Plastic Industries vs. Bank Leumi Le Israel
Performance |
| Timeline |
| Polyram Plastic Indu |
| Bank Leumi Le |
Polyram Plastic and Bank Leumi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polyram Plastic and Bank Leumi
The main advantage of trading using opposite Polyram Plastic and Bank Leumi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polyram Plastic position performs unexpectedly, Bank Leumi 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 Bank Leumi will offset losses from the drop in Bank Leumi's long position.| Polyram Plastic vs. Bank Leumi Le Israel | Polyram Plastic vs. Menif Financial Services | Polyram Plastic vs. Payment Financial Technologies | Polyram Plastic vs. Blender Financial Technologies |
| Bank Leumi vs. Menif Financial Services | Bank Leumi vs. Accel Solutions Group | Bank Leumi vs. Rani Zim Shopping | Bank Leumi vs. Rapac Communication Infrastructure |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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