Correlation Between Rami Levi and SR Accord
Can any of the company-specific risk be diversified away by investing in both Rami Levi and SR Accord 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 Rami Levi and SR Accord into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rami Levi and SR Accord, you can compare the effects of market volatilities on Rami Levi and SR Accord 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 Rami Levi with a short position of SR Accord. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rami Levi and SR Accord.
Diversification Opportunities for Rami Levi and SR Accord
Very poor diversification
The 3 months correlation between Rami and SRAC is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Rami Levi and SR Accord in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SR Accord and Rami Levi 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 Rami Levi are associated (or correlated) with SR Accord. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SR Accord has no effect on the direction of Rami Levi i.e., Rami Levi and SR Accord go up and down completely randomly.
Pair Corralation between Rami Levi and SR Accord
Assuming the 90 days trading horizon Rami Levi is expected to generate 1.65 times less return on investment than SR Accord. But when comparing it to its historical volatility, Rami Levi is 2.11 times less risky than SR Accord. It trades about 0.43 of its potential returns per unit of risk. SR Accord is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 305,471 in SR Accord on September 4, 2024 and sell it today you would earn a total of 61,232 from holding SR Accord or generate 20.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.44% |
| Values | Daily Returns |
Rami Levi vs. SR Accord
Performance |
| Timeline |
| Rami Levi |
| SR Accord |
Rami Levi and SR Accord Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rami Levi and SR Accord
The main advantage of trading using opposite Rami Levi and SR Accord positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rami Levi position performs unexpectedly, SR Accord 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 SR Accord will offset losses from the drop in SR Accord's long position.| Rami Levi vs. Shufersal | Rami Levi vs. Bank Leumi Le Israel | Rami Levi vs. Bezeq Israeli Telecommunication | Rami Levi vs. Bank Hapoalim |
| SR Accord vs. EN Shoham Business | SR Accord vs. Rani Zim Shopping | SR Accord vs. Mivtach Shamir | SR Accord vs. Accel Solutions Group |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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