Correlation Between Tel Aviv and Mivtach Shamir
Can any of the company-specific risk be diversified away by investing in both Tel Aviv and Mivtach Shamir 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 Mivtach Shamir 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 Mivtach Shamir, you can compare the effects of market volatilities on Tel Aviv and Mivtach Shamir 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 Mivtach Shamir. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tel Aviv and Mivtach Shamir.
Diversification Opportunities for Tel Aviv and Mivtach Shamir
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tel and Mivtach is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Tel Aviv 35 and Mivtach Shamir in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mivtach Shamir 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 Mivtach Shamir. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mivtach Shamir has no effect on the direction of Tel Aviv i.e., Tel Aviv and Mivtach Shamir go up and down completely randomly.
Pair Corralation between Tel Aviv and Mivtach Shamir
Assuming the 90 days trading horizon Tel Aviv is expected to generate 1.28 times less return on investment than Mivtach Shamir. But when comparing it to its historical volatility, Tel Aviv 35 is 2.25 times less risky than Mivtach Shamir. It trades about 0.36 of its potential returns per unit of risk. Mivtach Shamir is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,610,000 in Mivtach Shamir on August 25, 2024 and sell it today you would earn a total of 208,000 from holding Mivtach Shamir or generate 12.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tel Aviv 35 vs. Mivtach Shamir
Performance |
| Timeline |
Tel Aviv and Mivtach Shamir Volatility Contrast
Predicted Return Density |
| Returns |
Tel Aviv 35
Pair trading matchups for Tel Aviv
Mivtach Shamir
Pair trading matchups for Mivtach Shamir
Pair Trading with Tel Aviv and Mivtach Shamir
The main advantage of trading using opposite Tel Aviv and Mivtach Shamir positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tel Aviv position performs unexpectedly, Mivtach Shamir 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 Mivtach Shamir will offset losses from the drop in Mivtach Shamir's long position.| Tel Aviv vs. Feat Fund Investments | Tel Aviv vs. Libra Insurance | Tel Aviv vs. Blender Financial Technologies | Tel Aviv vs. Clal Insurance Enterprises |
| Mivtach Shamir vs. Bank Hapoalim | Mivtach Shamir vs. Israel Discount Bank | Mivtach Shamir vs. Mizrahi Tefahot | Mivtach Shamir vs. Bezeq Israeli Telecommunication |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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