Correlation Between Tel Aviv and Camtek
Can any of the company-specific risk be diversified away by investing in both Tel Aviv and Camtek 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 Tel Aviv and Camtek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tel Aviv 35 and Camtek, you can compare the effects of market volatilities on Tel Aviv and Camtek 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 Tel Aviv with a short position of Camtek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tel Aviv and Camtek.
Diversification Opportunities for Tel Aviv and Camtek
Very good diversification
The 3 months correlation between Tel and Camtek is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Tel Aviv 35 and Camtek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Camtek and Tel Aviv 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 Tel Aviv 35 are associated (or correlated) with Camtek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Camtek has no effect on the direction of Tel Aviv i.e., Tel Aviv and Camtek go up and down completely randomly.
Pair Corralation between Tel Aviv and Camtek
Assuming the 90 days trading horizon Tel Aviv 35 is expected to generate 0.26 times more return on investment than Camtek. However, Tel Aviv 35 is 3.92 times less risky than Camtek. It trades about 0.28 of its potential returns per unit of risk. Camtek is currently generating about -0.1 per unit of risk. If you would invest 217,424 in Tel Aviv 35 on August 25, 2024 and sell it today you would earn a total of 8,591 from holding Tel Aviv 35 or generate 3.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tel Aviv 35 vs. Camtek
Performance |
| Timeline |
Tel Aviv and Camtek Volatility Contrast
Predicted Return Density |
| Returns |
Tel Aviv 35
Pair trading matchups for Tel Aviv
Camtek
Pair trading matchups for Camtek
Pair Trading with Tel Aviv and Camtek
The main advantage of trading using opposite Tel Aviv and Camtek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tel Aviv position performs unexpectedly, Camtek 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 Camtek will offset losses from the drop in Camtek's long position.| Tel Aviv vs. Technoplus Ventures | Tel Aviv vs. Silver Castle Holdings | Tel Aviv vs. Rapac Communication Infrastructure | Tel Aviv vs. Unicorn 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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