Correlation Between Scope Metals and Bank Leumi
Can any of the company-specific risk be diversified away by investing in both Scope Metals 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 Scope Metals and Bank Leumi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scope Metals Group and Bank Leumi Le Israel, you can compare the effects of market volatilities on Scope Metals 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 Scope Metals with a short position of Bank Leumi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scope Metals and Bank Leumi.
Diversification Opportunities for Scope Metals and Bank Leumi
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Scope and Bank is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Scope Metals Group 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 Scope Metals 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 Scope Metals Group 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 Scope Metals i.e., Scope Metals and Bank Leumi go up and down completely randomly.
Pair Corralation between Scope Metals and Bank Leumi
Assuming the 90 days trading horizon Scope Metals is expected to generate 1.06 times less return on investment than Bank Leumi. In addition to that, Scope Metals is 1.03 times more volatile than Bank Leumi Le Israel. It trades about 0.15 of its total potential returns per unit of risk. Bank Leumi Le Israel is currently generating about 0.16 per unit of volatility. If you would invest 433,300 in Bank Leumi Le Israel on November 3, 2024 and sell it today you would earn a total of 15,200 from holding Bank Leumi Le Israel or generate 3.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scope Metals Group vs. Bank Leumi Le Israel
Performance |
| Timeline |
| Scope Metals Group |
| Bank Leumi Le |
Scope Metals and Bank Leumi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scope Metals and Bank Leumi
The main advantage of trading using opposite Scope Metals and Bank Leumi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scope Metals 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.| Scope Metals vs. Delek Automotive Systems | Scope Metals vs. Kerur Holdings | Scope Metals vs. Neto ME Holdings | Scope Metals vs. Bank Leumi Le Israel |
| Bank Leumi vs. Bank Hapoalim | Bank Leumi vs. Israel Discount Bank | Bank Leumi vs. Mizrahi Tefahot | Bank Leumi vs. Bezeq Israeli Telecommunication |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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