Correlation Between Mercedes Benz and Elbit Imaging
Can any of the company-specific risk be diversified away by investing in both Mercedes Benz and Elbit Imaging 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 Mercedes Benz and Elbit Imaging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mercedes Benz Group and Elbit Imaging, you can compare the effects of market volatilities on Mercedes Benz and Elbit Imaging 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 Mercedes Benz with a short position of Elbit Imaging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mercedes Benz and Elbit Imaging.
Diversification Opportunities for Mercedes Benz and Elbit Imaging
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mercedes and Elbit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mercedes Benz Group and Elbit Imaging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elbit Imaging and Mercedes Benz 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 Mercedes Benz Group are associated (or correlated) with Elbit Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elbit Imaging has no effect on the direction of Mercedes Benz i.e., Mercedes Benz and Elbit Imaging go up and down completely randomly.
Pair Corralation between Mercedes Benz and Elbit Imaging
If you would invest (100.00) in Mercedes Benz Group on January 25, 2024 and sell it today you would earn a total of 100.00 from holding Mercedes Benz Group or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Mercedes Benz Group vs. Elbit Imaging
Performance |
| Timeline |
| Mercedes Benz Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Elbit Imaging |
Mercedes Benz and Elbit Imaging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mercedes Benz and Elbit Imaging
The main advantage of trading using opposite Mercedes Benz and Elbit Imaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mercedes Benz position performs unexpectedly, Elbit Imaging 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 Elbit Imaging will offset losses from the drop in Elbit Imaging's long position.| Mercedes Benz vs. Chiba Bank Ltd | Mercedes Benz vs. Marchex | Mercedes Benz vs. Artisan Partners Asset | Mercedes Benz vs. WPP PLC ADR |
| Elbit Imaging vs. Intercure | Elbit Imaging vs. Sofwave Medical | Elbit Imaging vs. Epitomee Medical | Elbit Imaging vs. Brainsway |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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