Correlation Between Sella Real and Photomyne
Can any of the company-specific risk be diversified away by investing in both Sella Real and Photomyne 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 Photomyne 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 Photomyne, you can compare the effects of market volatilities on Sella Real and Photomyne 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 Photomyne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sella Real and Photomyne.
Diversification Opportunities for Sella Real and Photomyne
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sella and Photomyne is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Sella Real Estate and Photomyne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Photomyne 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 Photomyne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Photomyne has no effect on the direction of Sella Real i.e., Sella Real and Photomyne go up and down completely randomly.
Pair Corralation between Sella Real and Photomyne
Assuming the 90 days trading horizon Sella Real is expected to generate 1.92 times less return on investment than Photomyne. But when comparing it to its historical volatility, Sella Real Estate is 1.41 times less risky than Photomyne. It trades about 0.05 of its potential returns per unit of risk. Photomyne is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 161,000 in Photomyne on September 13, 2024 and sell it today you would earn a total of 140,400 from holding Photomyne or generate 87.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sella Real Estate vs. Photomyne
Performance |
| Timeline |
| Sella Real Estate |
| Photomyne |
Sella Real and Photomyne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sella Real and Photomyne
The main advantage of trading using opposite Sella Real and Photomyne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sella Real position performs unexpectedly, Photomyne 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 Photomyne will offset losses from the drop in Photomyne's long position.| Sella Real vs. Isras Investment | Sella Real vs. Harel Insurance Investments | Sella Real vs. B Communications | Sella Real vs. Photomyne |
| Photomyne vs. Nice | Photomyne vs. WhiteSmoke Software | Photomyne vs. Abra Information Technologies | Photomyne vs. Nrgene Technologies |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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