Correlation Between Ashot Ashkelon and Global Knafaim
Can any of the company-specific risk be diversified away by investing in both Ashot Ashkelon and Global Knafaim 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 Ashot Ashkelon and Global Knafaim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashot Ashkelon Industries and Global Knafaim Leasing, you can compare the effects of market volatilities on Ashot Ashkelon and Global Knafaim 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 Ashot Ashkelon with a short position of Global Knafaim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashot Ashkelon and Global Knafaim.
Diversification Opportunities for Ashot Ashkelon and Global Knafaim
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ashot and Global is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Ashot Ashkelon Industries and Global Knafaim Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Knafaim Leasing and Ashot Ashkelon 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 Ashot Ashkelon Industries are associated (or correlated) with Global Knafaim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Knafaim Leasing has no effect on the direction of Ashot Ashkelon i.e., Ashot Ashkelon and Global Knafaim go up and down completely randomly.
Pair Corralation between Ashot Ashkelon and Global Knafaim
Assuming the 90 days trading horizon Ashot Ashkelon Industries is expected to under-perform the Global Knafaim. In addition to that, Ashot Ashkelon is 1.18 times more volatile than Global Knafaim Leasing. It trades about -0.06 of its total potential returns per unit of risk. Global Knafaim Leasing is currently generating about 0.18 per unit of volatility. If you would invest 5,510 in Global Knafaim Leasing on January 24, 2024 and sell it today you would earn a total of 490.00 from holding Global Knafaim Leasing or generate 8.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashot Ashkelon Industries vs. Global Knafaim Leasing
Performance |
| Timeline |
| Ashot Ashkelon Industries |
| Global Knafaim Leasing |
Ashot Ashkelon and Global Knafaim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashot Ashkelon and Global Knafaim
The main advantage of trading using opposite Ashot Ashkelon and Global Knafaim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashot Ashkelon position performs unexpectedly, Global Knafaim 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 Global Knafaim will offset losses from the drop in Global Knafaim's long position.| Ashot Ashkelon vs. Al Bad Massuot Yitzhak | Ashot Ashkelon vs. Gan Shmuel | Ashot Ashkelon vs. Analyst IMS Investment |
| Global Knafaim vs. Al Bad Massuot Yitzhak | Global Knafaim vs. Gan Shmuel | Global Knafaim vs. Analyst IMS Investment |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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