Correlation Between Shagrir Group and Retailors
Can any of the company-specific risk be diversified away by investing in both Shagrir Group and Retailors 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 Retailors 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 Retailors, you can compare the effects of market volatilities on Shagrir Group and Retailors 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 Retailors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shagrir Group and Retailors.
Diversification Opportunities for Shagrir Group and Retailors
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shagrir and Retailors is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Shagrir Group Vehicle and Retailors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retailors 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 Retailors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retailors has no effect on the direction of Shagrir Group i.e., Shagrir Group and Retailors go up and down completely randomly.
Pair Corralation between Shagrir Group and Retailors
Assuming the 90 days trading horizon Shagrir Group Vehicle is expected to generate 0.82 times more return on investment than Retailors. However, Shagrir Group Vehicle is 1.22 times less risky than Retailors. It trades about 0.19 of its potential returns per unit of risk. Retailors is currently generating about 0.15 per unit of risk. If you would invest 110,900 in Shagrir Group Vehicle on September 1, 2024 and sell it today you would earn a total of 10,300 from holding Shagrir Group Vehicle or generate 9.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shagrir Group Vehicle vs. Retailors
Performance |
| Timeline |
| Shagrir Group Vehicle |
| Retailors |
Shagrir Group and Retailors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shagrir Group and Retailors
The main advantage of trading using opposite Shagrir Group and Retailors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shagrir Group position performs unexpectedly, Retailors 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 Retailors will offset losses from the drop in Retailors' long position.| Shagrir Group vs. Arad | Shagrir Group vs. Alony Hetz Properties | Shagrir Group vs. Airport City | Shagrir Group vs. Harel Insurance Investments |
| Retailors vs. Nice | Retailors vs. The Gold Bond | Retailors vs. Bank Leumi Le Israel | Retailors vs. ICL Israel Chemicals |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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