Correlation Between Rekah Pharmaceutical and Kamada
Can any of the company-specific risk be diversified away by investing in both Rekah Pharmaceutical and Kamada 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 Rekah Pharmaceutical and Kamada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rekah Pharmaceutical Industry and Kamada, you can compare the effects of market volatilities on Rekah Pharmaceutical and Kamada 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 Rekah Pharmaceutical with a short position of Kamada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rekah Pharmaceutical and Kamada.
Diversification Opportunities for Rekah Pharmaceutical and Kamada
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Rekah and Kamada is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Rekah Pharmaceutical Industry and Kamada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kamada and Rekah Pharmaceutical 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 Rekah Pharmaceutical Industry are associated (or correlated) with Kamada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kamada has no effect on the direction of Rekah Pharmaceutical i.e., Rekah Pharmaceutical and Kamada go up and down completely randomly.
Pair Corralation between Rekah Pharmaceutical and Kamada
Assuming the 90 days trading horizon Rekah Pharmaceutical Industry is expected to generate 1.94 times more return on investment than Kamada. However, Rekah Pharmaceutical is 1.94 times more volatile than Kamada. It trades about 0.08 of its potential returns per unit of risk. Kamada is currently generating about 0.06 per unit of risk. If you would invest 122,500 in Rekah Pharmaceutical Industry on September 3, 2024 and sell it today you would earn a total of 27,400 from holding Rekah Pharmaceutical Industry or generate 22.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rekah Pharmaceutical Industry vs. Kamada
Performance |
| Timeline |
| Rekah Pharmaceutical |
| Kamada |
Rekah Pharmaceutical and Kamada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rekah Pharmaceutical and Kamada
The main advantage of trading using opposite Rekah Pharmaceutical and Kamada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rekah Pharmaceutical position performs unexpectedly, Kamada 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 Kamada will offset losses from the drop in Kamada's long position.| Rekah Pharmaceutical vs. Kamada | Rekah Pharmaceutical vs. Bet Shemesh Engines | Rekah Pharmaceutical vs. Unitronics | Rekah Pharmaceutical vs. PCB Tec |
| Kamada vs. Kamada | Kamada vs. Teva Pharmaceutical Industries | Kamada vs. Tower Semiconductor | Kamada vs. Elbit Systems |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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