Correlation Between Prashkovsky and Shikun Binui
Can any of the company-specific risk be diversified away by investing in both Prashkovsky and Shikun Binui 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 Prashkovsky and Shikun Binui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prashkovsky and Shikun Binui, you can compare the effects of market volatilities on Prashkovsky and Shikun Binui 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 Prashkovsky with a short position of Shikun Binui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prashkovsky and Shikun Binui.
Diversification Opportunities for Prashkovsky and Shikun Binui
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Prashkovsky and Shikun is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Prashkovsky and Shikun Binui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shikun Binui and Prashkovsky 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 Prashkovsky are associated (or correlated) with Shikun Binui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shikun Binui has no effect on the direction of Prashkovsky i.e., Prashkovsky and Shikun Binui go up and down completely randomly.
Pair Corralation between Prashkovsky and Shikun Binui
Assuming the 90 days trading horizon Prashkovsky is expected to generate 4.76 times less return on investment than Shikun Binui. But when comparing it to its historical volatility, Prashkovsky is 1.37 times less risky than Shikun Binui. It trades about 0.12 of its potential returns per unit of risk. Shikun Binui is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 99,200 in Shikun Binui on September 1, 2024 and sell it today you would earn a total of 19,600 from holding Shikun Binui or generate 19.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prashkovsky vs. Shikun Binui
Performance |
| Timeline |
| Prashkovsky |
| Shikun Binui |
Prashkovsky and Shikun Binui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prashkovsky and Shikun Binui
The main advantage of trading using opposite Prashkovsky and Shikun Binui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prashkovsky position performs unexpectedly, Shikun Binui 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 Shikun Binui will offset losses from the drop in Shikun Binui's long position.| Prashkovsky vs. Fattal 1998 Holdings | Prashkovsky vs. Azrieli Group | Prashkovsky vs. Clal Insurance Enterprises |
| Shikun Binui vs. Israel Discount Bank | Shikun Binui vs. Bezeq Israeli Telecommunication | Shikun Binui vs. Azrieli Group | Shikun Binui 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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