Correlation Between Almogim Holdings and Multi Retail

Can any of the company-specific risk be diversified away by investing in both Almogim Holdings and Multi Retail 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 Almogim Holdings and Multi Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Almogim Holdings and Multi Retail Group, you can compare the effects of market volatilities on Almogim Holdings and Multi Retail 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 Almogim Holdings with a short position of Multi Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Almogim Holdings and Multi Retail.

Diversification Opportunities for Almogim Holdings and Multi Retail

0.86

Correlation Coefficient

Almogim Holdings  Multi Retail

Very poor diversification

The 3 months correlation between Almogim and Multi is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Almogim Holdings and Multi Retail Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Retail Group and Almogim Holdings 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 Almogim Holdings are associated (or correlated) with Multi Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Retail Group has no effect on the direction of Almogim Holdings i.e., Almogim Holdings and Multi Retail go up and down completely randomly.

Pair Corralation between Almogim Holdings and Multi Retail

Assuming the 90 days trading horizon Almogim Holdings is expected to generate 2.37 times less return on investment than Multi Retail. But when comparing it to its historical volatility, Almogim Holdings is 2.34 times less risky than Multi Retail. It trades about 0.38 of its potential returns per unit of risk. Multi Retail Group is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest  58,950  in Multi Retail Group on September 29, 2024 and sell it today you would earn a total of  53,450  from holding Multi Retail Group or generate 90.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Almogim Holdings  vs.  Multi Retail Group

Almogim Holdings

Risk-Adjusted Performance

29 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Almogim Holdings are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Almogim Holdings sustained solid returns over the last few months and may actually be approaching a breakup point.

Multi Retail Group

Risk-Adjusted Performance

30 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Multi Retail Group are ranked lower than 30 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Multi Retail sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Almogim Holdings and Multi Retail

The main advantage of trading using opposite Almogim Holdings and Multi Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Almogim Holdings position performs unexpectedly, Multi Retail 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 Multi Retail will offset losses from the drop in Multi Retail's long position.

The idea behind Almogim Holdings and Multi Retail Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.