Correlation Between Amanet Management and Elron Electronic
Can any of the company-specific risk be diversified away by investing in both Amanet Management and Elron Electronic 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 Amanet Management and Elron Electronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amanet Management Systems and Elron Electronic Industries, you can compare the effects of market volatilities on Amanet Management and Elron Electronic 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 Amanet Management with a short position of Elron Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amanet Management and Elron Electronic.
Diversification Opportunities for Amanet Management and Elron Electronic
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Amanet and Elron is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Amanet Management Systems and Elron Electronic Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elron Electronic Ind and Amanet Management 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 Amanet Management Systems are associated (or correlated) with Elron Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elron Electronic Ind has no effect on the direction of Amanet Management i.e., Amanet Management and Elron Electronic go up and down completely randomly.
Pair Corralation between Amanet Management and Elron Electronic
Assuming the 90 days trading horizon Amanet Management Systems is expected to generate 0.66 times more return on investment than Elron Electronic. However, Amanet Management Systems is 1.53 times less risky than Elron Electronic. It trades about 0.01 of its potential returns per unit of risk. Elron Electronic Industries is currently generating about -0.01 per unit of risk. If you would invest 183,620 in Amanet Management Systems on February 7, 2024 and sell it today you would lose (7,820) from holding Amanet Management Systems or give up 4.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amanet Management Systems vs. Elron Electronic Industries
Performance |
| Timeline |
| Amanet Management Systems |
| Elron Electronic Ind |
Amanet Management and Elron Electronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amanet Management and Elron Electronic
The main advantage of trading using opposite Amanet Management and Elron Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amanet Management position performs unexpectedly, Elron Electronic 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 Elron Electronic will offset losses from the drop in Elron Electronic's long position.| Amanet Management vs. Aran Research and | Amanet Management vs. Al Bad Massuot Yitzhak | Amanet Management vs. Gan Shmuel | Amanet Management vs. Analyst IMS Investment |
| Elron Electronic vs. Nice | Elron Electronic vs. ICL Israel Chemicals | Elron Electronic vs. Azrieli Group | Elron Electronic vs. Elbit Systems |
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 CEOs Directory module to screen CEOs from public companies around the world.
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