Correlation Between Psagot Index and Harel Index
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By analyzing existing cross correlation between Psagot Index Funds and Harel Index Funds, you can compare the effects of market volatilities on Psagot Index and Harel Index 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 Psagot Index with a short position of Harel Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Psagot Index and Harel Index.
Diversification Opportunities for Psagot Index and Harel Index
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Psagot and Harel is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Psagot Index Funds and Harel Index Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harel Index Funds and Psagot Index 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 Psagot Index Funds are associated (or correlated) with Harel Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harel Index Funds has no effect on the direction of Psagot Index i.e., Psagot Index and Harel Index go up and down completely randomly.
Pair Corralation between Psagot Index and Harel Index
Assuming the 90 days trading horizon Psagot Index is expected to generate 1.44 times less return on investment than Harel Index. But when comparing it to its historical volatility, Psagot Index Funds is 1.27 times less risky than Harel Index. It trades about 0.07 of its potential returns per unit of risk. Harel Index Funds is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 173,100 in Harel Index Funds on September 3, 2024 and sell it today you would earn a total of 74,900 from holding Harel Index Funds or generate 43.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.96% |
| Values | Daily Returns |
Psagot Index Funds vs. Harel Index Funds
Performance |
| Timeline |
| Psagot Index Funds |
| Harel Index Funds |
Psagot Index and Harel Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Psagot Index and Harel Index
The main advantage of trading using opposite Psagot Index and Harel Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Psagot Index position performs unexpectedly, Harel Index 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 Harel Index will offset losses from the drop in Harel Index's long position.The idea behind Psagot Index Funds and Harel Index Funds pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Harel Index vs. Harel Index Funds | Harel Index vs. Harel Sal Tel Bond | Harel Index vs. Harel Index Funds | Harel Index vs. Harel Index Funds |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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