Correlation Between Delek Automotive and Carasso
Can any of the company-specific risk be diversified away by investing in both Delek Automotive and Carasso 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 Delek Automotive and Carasso into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Automotive Systems and Carasso, you can compare the effects of market volatilities on Delek Automotive and Carasso 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 Delek Automotive with a short position of Carasso. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Automotive and Carasso.
Diversification Opportunities for Delek Automotive and Carasso
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Delek and Carasso is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Delek Automotive Systems and Carasso in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carasso and Delek Automotive 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 Delek Automotive Systems are associated (or correlated) with Carasso. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carasso has no effect on the direction of Delek Automotive i.e., Delek Automotive and Carasso go up and down completely randomly.
Pair Corralation between Delek Automotive and Carasso
Assuming the 90 days trading horizon Delek Automotive is expected to generate 2.45 times less return on investment than Carasso. In addition to that, Delek Automotive is 1.64 times more volatile than Carasso. It trades about 0.04 of its total potential returns per unit of risk. Carasso is currently generating about 0.16 per unit of volatility. If you would invest 163,200 in Carasso on February 12, 2024 and sell it today you would earn a total of 24,200 from holding Carasso or generate 14.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Automotive Systems vs. Carasso
Performance |
| Timeline |
| Delek Automotive Systems |
| Carasso |
Delek Automotive and Carasso Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Automotive and Carasso
The main advantage of trading using opposite Delek Automotive and Carasso positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Automotive position performs unexpectedly, Carasso 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 Carasso will offset losses from the drop in Carasso's long position.| Delek Automotive vs. Clal Insurance Enterprises | Delek Automotive vs. Israel Discount Bank | Delek Automotive vs. Bezeq Israeli Telecommunication | Delek Automotive vs. Alony Hetz Properties |
| Carasso vs. Clal Insurance Enterprises | Carasso vs. Israel Discount Bank | Carasso vs. Bezeq Israeli Telecommunication | Carasso vs. Alony Hetz Properties |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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