Correlation Between G Willi and Rapac Communication
Can any of the company-specific risk be diversified away by investing in both G Willi and Rapac Communication 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 G Willi and Rapac Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G Willi Food International and Rapac Communication Infrastructure, you can compare the effects of market volatilities on G Willi and Rapac Communication 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 G Willi with a short position of Rapac Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of G Willi and Rapac Communication.
Diversification Opportunities for G Willi and Rapac Communication
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WILC and Rapac is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding G Willi Food International and Rapac Communication Infrastruc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rapac Communication and G Willi 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 G Willi Food International are associated (or correlated) with Rapac Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rapac Communication has no effect on the direction of G Willi i.e., G Willi and Rapac Communication go up and down completely randomly.
Pair Corralation between G Willi and Rapac Communication
Assuming the 90 days trading horizon G Willi Food International is expected to generate 2.51 times more return on investment than Rapac Communication. However, G Willi is 2.51 times more volatile than Rapac Communication Infrastructure. It trades about 0.24 of its potential returns per unit of risk. Rapac Communication Infrastructure is currently generating about -0.24 per unit of risk. If you would invest 458,700 in G Willi Food International on August 30, 2024 and sell it today you would earn a total of 64,200 from holding G Willi Food International or generate 14.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.74% |
| Values | Daily Returns |
G Willi Food International vs. Rapac Communication Infrastruc
Performance |
| Timeline |
| G Willi Food |
| Rapac Communication |
G Willi and Rapac Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G Willi and Rapac Communication
The main advantage of trading using opposite G Willi and Rapac Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G Willi position performs unexpectedly, Rapac Communication 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 Rapac Communication will offset losses from the drop in Rapac Communication's long position.| G Willi vs. Nice | G Willi vs. The Gold Bond | G Willi vs. Bank Leumi Le Israel | G Willi vs. ICL Israel Chemicals |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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