Correlation Between Automatic Bank and YH Dimri
Can any of the company-specific risk be diversified away by investing in both Automatic Bank and YH Dimri 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 Automatic Bank and YH Dimri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Automatic Bank Services and YH Dimri Construction, you can compare the effects of market volatilities on Automatic Bank and YH Dimri 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 Automatic Bank with a short position of YH Dimri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Automatic Bank and YH Dimri.
Diversification Opportunities for Automatic Bank and YH Dimri
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Automatic and DIMRI is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Automatic Bank Services and YH Dimri Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YH Dimri Construction and Automatic Bank 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 Automatic Bank Services are associated (or correlated) with YH Dimri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YH Dimri Construction has no effect on the direction of Automatic Bank i.e., Automatic Bank and YH Dimri go up and down completely randomly.
Pair Corralation between Automatic Bank and YH Dimri
Assuming the 90 days trading horizon Automatic Bank Services is expected to generate 1.49 times more return on investment than YH Dimri. However, Automatic Bank is 1.49 times more volatile than YH Dimri Construction. It trades about 0.38 of its potential returns per unit of risk. YH Dimri Construction is currently generating about 0.05 per unit of risk. If you would invest 141,600 in Automatic Bank Services on September 2, 2024 and sell it today you would earn a total of 72,000 from holding Automatic Bank Services or generate 50.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Automatic Bank Services vs. YH Dimri Construction
Performance |
| Timeline |
| Automatic Bank Services |
| YH Dimri Construction |
Automatic Bank and YH Dimri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Automatic Bank and YH Dimri
The main advantage of trading using opposite Automatic Bank and YH Dimri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Automatic Bank position performs unexpectedly, YH Dimri 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 YH Dimri will offset losses from the drop in YH Dimri's long position.| Automatic Bank vs. Telsys | Automatic Bank vs. EN Shoham Business | Automatic Bank vs. Brainsway | Automatic Bank vs. Mivne Real Estate |
| YH Dimri vs. Azrieli Group | YH Dimri vs. Israel Canada | YH Dimri vs. Ashtrom Group | YH Dimri vs. Shikun Binui |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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