Correlation Between EN Shoham and Telsys
Can any of the company-specific risk be diversified away by investing in both EN Shoham and Telsys 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 EN Shoham and Telsys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EN Shoham Business and Telsys, you can compare the effects of market volatilities on EN Shoham and Telsys 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 EN Shoham with a short position of Telsys. Check out your portfolio center. Please also check ongoing floating volatility patterns of EN Shoham and Telsys.
Diversification Opportunities for EN Shoham and Telsys
Very weak diversification
The 3 months correlation between SHOM and Telsys is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding EN Shoham Business and Telsys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telsys and EN Shoham 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 EN Shoham Business are associated (or correlated) with Telsys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telsys has no effect on the direction of EN Shoham i.e., EN Shoham and Telsys go up and down completely randomly.
Pair Corralation between EN Shoham and Telsys
Assuming the 90 days trading horizon EN Shoham Business is expected to generate 0.71 times more return on investment than Telsys. However, EN Shoham Business is 1.4 times less risky than Telsys. It trades about 0.08 of its potential returns per unit of risk. Telsys is currently generating about -0.06 per unit of risk. If you would invest 53,039 in EN Shoham Business on August 27, 2024 and sell it today you would earn a total of 12,311 from holding EN Shoham Business or generate 23.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EN Shoham Business vs. Telsys
Performance |
| Timeline |
| EN Shoham Business |
| Telsys |
EN Shoham and Telsys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EN Shoham and Telsys
The main advantage of trading using opposite EN Shoham and Telsys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EN Shoham position performs unexpectedly, Telsys 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 Telsys will offset losses from the drop in Telsys' long position.| EN Shoham vs. Bank Hapoalim | EN Shoham vs. Israel Discount Bank | EN Shoham vs. Bezeq Israeli Telecommunication | EN Shoham vs. Elbit Systems |
| Telsys vs. Automatic Bank Services | Telsys vs. EN Shoham Business | Telsys vs. Rapac Communication Infrastructure | Telsys vs. Qualitau |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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