Overlapping area represents the amount of risk that can be diversified away by holding NIKKEI 225 and Israel Index in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Israel Index and NIKKEI 225 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 NIKKEI 225 are associated (or correlated) with Israel Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Israel Index has no effect on the direction of NIKKEI 225 i.e. NIKKEI 225 and Israel Index go up and down completely randomly.