Correlation Between Gilat Satellite and Energix Renewable
Can any of the company-specific risk be diversified away by investing in both Gilat Satellite and Energix Renewable 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 Gilat Satellite and Energix Renewable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gilat Satellite Networks and Energix Renewable Energies, you can compare the effects of market volatilities on Gilat Satellite and Energix Renewable 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 Gilat Satellite with a short position of Energix Renewable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gilat Satellite and Energix Renewable.
Diversification Opportunities for Gilat Satellite and Energix Renewable
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gilat and Energix is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Gilat Satellite Networks and Energix Renewable Energies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energix Renewable and Gilat Satellite 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 Gilat Satellite Networks are associated (or correlated) with Energix Renewable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energix Renewable has no effect on the direction of Gilat Satellite i.e., Gilat Satellite and Energix Renewable go up and down completely randomly.
Pair Corralation between Gilat Satellite and Energix Renewable
Assuming the 90 days trading horizon Gilat Satellite Networks is expected to under-perform the Energix Renewable. In addition to that, Gilat Satellite is 1.45 times more volatile than Energix Renewable Energies. It trades about -0.05 of its total potential returns per unit of risk. Energix Renewable Energies is currently generating about 0.22 per unit of volatility. If you would invest 132,500 in Energix Renewable Energies on January 20, 2024 and sell it today you would earn a total of 11,000 from holding Energix Renewable Energies or generate 8.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gilat Satellite Networks vs. Energix Renewable Energies
Performance |
| Timeline |
| Gilat Satellite Networks |
| Energix Renewable |
Gilat Satellite and Energix Renewable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gilat Satellite and Energix Renewable
The main advantage of trading using opposite Gilat Satellite and Energix Renewable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gilat Satellite position performs unexpectedly, Energix Renewable 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 Energix Renewable will offset losses from the drop in Energix Renewable's long position.| Gilat Satellite vs. Automatic Bank Services | Gilat Satellite vs. EN Shoham Business | Gilat Satellite vs. Rapac Communication Infrastructure | Gilat Satellite vs. Tadiran Hldg |
| Energix Renewable vs. Doral Group Renewable | Energix Renewable vs. Elbit Systems | Energix Renewable vs. Electreon Wireless | Energix Renewable vs. Delek Group |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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