Correlation Between Ellomay Capital and Azrieli
Can any of the company-specific risk be diversified away by investing in both Ellomay Capital and Azrieli 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 Ellomay Capital and Azrieli into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ellomay Capital and Azrieli Group, you can compare the effects of market volatilities on Ellomay Capital and Azrieli 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 Ellomay Capital with a short position of Azrieli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ellomay Capital and Azrieli.
Diversification Opportunities for Ellomay Capital and Azrieli
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ellomay and Azrieli is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ellomay Capital and Azrieli Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azrieli Group and Ellomay Capital 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 Ellomay Capital are associated (or correlated) with Azrieli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azrieli Group has no effect on the direction of Ellomay Capital i.e., Ellomay Capital and Azrieli go up and down completely randomly.
Pair Corralation between Ellomay Capital and Azrieli
Assuming the 90 days trading horizon Ellomay Capital is expected to generate 1.06 times more return on investment than Azrieli. However, Ellomay Capital is 1.06 times more volatile than Azrieli Group. It trades about -0.11 of its potential returns per unit of risk. Azrieli Group is currently generating about -0.21 per unit of risk. If you would invest 595,400 in Ellomay Capital on January 20, 2024 and sell it today you would lose (24,700) from holding Ellomay Capital or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ellomay Capital vs. Azrieli Group
Performance |
| Timeline |
| Ellomay Capital |
| Azrieli Group |
Ellomay Capital and Azrieli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ellomay Capital and Azrieli
The main advantage of trading using opposite Ellomay Capital and Azrieli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ellomay Capital position performs unexpectedly, Azrieli 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 Azrieli will offset losses from the drop in Azrieli's long position.| Ellomay Capital vs. Enlight Renewable Energy | Ellomay Capital vs. Energix Renewable Energies | Ellomay Capital vs. Ellomay Capital | Ellomay Capital vs. Doral Group Renewable |
| Azrieli vs. Migdal Insurance | Azrieli vs. The Phoenix Holdings | Azrieli vs. Harel Insurance Investments | Azrieli vs. Clal Insurance Enterprises |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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