Correlation Between Shagrir Group and Magic Software
Can any of the company-specific risk be diversified away by investing in both Shagrir Group and Magic Software 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 Shagrir Group and Magic Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shagrir Group Vehicle and Magic Software Enterprises, you can compare the effects of market volatilities on Shagrir Group and Magic Software 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 Shagrir Group with a short position of Magic Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shagrir Group and Magic Software.
Diversification Opportunities for Shagrir Group and Magic Software
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shagrir and Magic is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Shagrir Group Vehicle and Magic Software Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magic Software Enter and Shagrir Group 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 Shagrir Group Vehicle are associated (or correlated) with Magic Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magic Software Enter has no effect on the direction of Shagrir Group i.e., Shagrir Group and Magic Software go up and down completely randomly.
Pair Corralation between Shagrir Group and Magic Software
Assuming the 90 days trading horizon Shagrir Group Vehicle is expected to generate 0.82 times more return on investment than Magic Software. However, Shagrir Group Vehicle is 1.22 times less risky than Magic Software. It trades about 0.25 of its potential returns per unit of risk. Magic Software Enterprises is currently generating about 0.11 per unit of risk. If you would invest 93,220 in Shagrir Group Vehicle on September 12, 2024 and sell it today you would earn a total of 26,980 from holding Shagrir Group Vehicle or generate 28.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shagrir Group Vehicle vs. Magic Software Enterprises
Performance |
| Timeline |
| Shagrir Group Vehicle |
| Magic Software Enter |
Shagrir Group and Magic Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shagrir Group and Magic Software
The main advantage of trading using opposite Shagrir Group and Magic Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shagrir Group position performs unexpectedly, Magic Software 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 Magic Software will offset losses from the drop in Magic Software's long position.| Shagrir Group vs. EN Shoham Business | Shagrir Group vs. Suny Cellular Communication | Shagrir Group vs. Rani Zim Shopping | Shagrir Group vs. Tadiran Hldg |
| Magic Software vs. Sapiens International | Magic Software vs. AudioCodes | Magic Software vs. Matrix | Magic Software vs. Tower Semiconductor |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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