Correlation Between Sella Real and Levinstein Prop
Can any of the company-specific risk be diversified away by investing in both Sella Real and Levinstein Prop 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 Sella Real and Levinstein Prop into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sella Real Estate and Levinstein Prop, you can compare the effects of market volatilities on Sella Real and Levinstein Prop 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 Sella Real with a short position of Levinstein Prop. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sella Real and Levinstein Prop.
Diversification Opportunities for Sella Real and Levinstein Prop
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sella and Levinstein is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sella Real Estate and Levinstein Prop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Levinstein Prop and Sella Real 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 Sella Real Estate are associated (or correlated) with Levinstein Prop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Levinstein Prop has no effect on the direction of Sella Real i.e., Sella Real and Levinstein Prop go up and down completely randomly.
Pair Corralation between Sella Real and Levinstein Prop
Assuming the 90 days trading horizon Sella Real is expected to generate 1.65 times less return on investment than Levinstein Prop. But when comparing it to its historical volatility, Sella Real Estate is 1.77 times less risky than Levinstein Prop. It trades about 0.72 of its potential returns per unit of risk. Levinstein Prop is currently generating about 0.67 of returns per unit of risk over similar time horizon. If you would invest 566,400 in Levinstein Prop on August 25, 2024 and sell it today you would earn a total of 173,700 from holding Levinstein Prop or generate 30.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sella Real Estate vs. Levinstein Prop
Performance |
| Timeline |
| Sella Real Estate |
| Levinstein Prop |
Sella Real and Levinstein Prop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sella Real and Levinstein Prop
The main advantage of trading using opposite Sella Real and Levinstein Prop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sella Real position performs unexpectedly, Levinstein Prop 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 Levinstein Prop will offset losses from the drop in Levinstein Prop's long position.| Sella Real vs. Israel Canada | Sella Real vs. Azrieli Group | Sella Real vs. Delek Group | Sella Real vs. Shikun Binui |
| Levinstein Prop vs. Sella Real Estate | Levinstein Prop vs. Amot Investments | Levinstein Prop vs. Israel Canada | Levinstein Prop vs. YH Dimri Construction |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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