Correlation Between Big Shopping and Alony Hetz

Can any of the company-specific risk be diversified away by investing in both Big Shopping and Alony Hetz 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 Big Shopping and Alony Hetz into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Big Shopping Centers and Alony Hetz Properties, you can compare the effects of market volatilities on Big Shopping and Alony Hetz 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 Big Shopping with a short position of Alony Hetz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Shopping and Alony Hetz.

Diversification Opportunities for Big Shopping and Alony Hetz

0.42

Correlation Coefficient

Big Shopping  Alony Hetz

Very weak diversification

The 3 months correlation between Big and Alony is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Big Shopping Centers and Alony Hetz Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alony Hetz Properties and Big Shopping 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 Big Shopping Centers are associated (or correlated) with Alony Hetz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alony Hetz Properties has no effect on the direction of Big Shopping i.e., Big Shopping and Alony Hetz go up and down completely randomly.

Pair Corralation between Big Shopping and Alony Hetz

Assuming the 90 days trading horizon Big Shopping Centers is expected to generate 0.62 times more return on investment than Alony Hetz. However, Big Shopping Centers is 1.61 times less risky than Alony Hetz. It trades about 0.41 of its potential returns per unit of risk. Alony Hetz Properties is currently generating about 0.06 per unit of risk. If you would invest  4,100,000  in Big Shopping Centers on September 26, 2024 and sell it today you would earn a total of  1,283,000  from holding Big Shopping Centers or generate 31.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	97.83%
Values	Daily Returns

Big Shopping Centers  vs.  Alony Hetz Properties

Big Shopping Centers

Risk-Adjusted Performance

32 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Big Shopping Centers are ranked lower than 32 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Big Shopping sustained solid returns over the last few months and may actually be approaching a breakup point.

Alony Hetz Properties

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Alony Hetz Properties are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Alony Hetz may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Big Shopping and Alony Hetz

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

The idea behind Big Shopping Centers and Alony Hetz Properties 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.