Correlation Between TAT Technologies and Cellcom Israel
Can any of the company-specific risk be diversified away by investing in both TAT Technologies and Cellcom Israel 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 TAT Technologies and Cellcom Israel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TAT Technologies and Cellcom Israel, you can compare the effects of market volatilities on TAT Technologies and Cellcom Israel 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 TAT Technologies with a short position of Cellcom Israel. Check out your portfolio center. Please also check ongoing floating volatility patterns of TAT Technologies and Cellcom Israel.
Diversification Opportunities for TAT Technologies and Cellcom Israel
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between TAT and Cellcom is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding TAT Technologies and Cellcom Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellcom Israel and TAT Technologies 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 TAT Technologies are associated (or correlated) with Cellcom Israel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellcom Israel has no effect on the direction of TAT Technologies i.e., TAT Technologies and Cellcom Israel go up and down completely randomly.
Pair Corralation between TAT Technologies and Cellcom Israel
Assuming the 90 days trading horizon TAT Technologies is expected to generate 1.39 times more return on investment than Cellcom Israel. However, TAT Technologies is 1.39 times more volatile than Cellcom Israel. It trades about 0.32 of its potential returns per unit of risk. Cellcom Israel is currently generating about 0.33 per unit of risk. If you would invest 705,000 in TAT Technologies on September 12, 2024 and sell it today you would earn a total of 180,000 from holding TAT Technologies or generate 25.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TAT Technologies vs. Cellcom Israel
Performance |
| Timeline |
| TAT Technologies |
| Cellcom Israel |
TAT Technologies and Cellcom Israel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TAT Technologies and Cellcom Israel
The main advantage of trading using opposite TAT Technologies and Cellcom Israel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TAT Technologies position performs unexpectedly, Cellcom Israel 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 Cellcom Israel will offset losses from the drop in Cellcom Israel's long position.| TAT Technologies vs. Bet Shemesh Engines | TAT Technologies vs. Orbit Technologies | TAT Technologies vs. Tower Semiconductor | TAT Technologies vs. Elron Electronic Industries |
| Cellcom Israel vs. Ormat Technologies | Cellcom Israel vs. ICL Israel Chemicals | Cellcom Israel vs. Technoplus Ventures | Cellcom Israel vs. TAT 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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