Correlation Between Capital Point and Menora Miv

Can any of the company-specific risk be diversified away by investing in both Capital Point and Menora Miv 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 Capital Point and Menora Miv into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Capital Point and Menora Miv Hld, you can compare the effects of market volatilities on Capital Point and Menora Miv 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 Capital Point with a short position of Menora Miv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Point and Menora Miv.

Diversification Opportunities for Capital Point and Menora Miv

0.5

Correlation Coefficient

Capital Point  Menora Miv

Very weak diversification

The 3 months correlation between Capital and Menora is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Capital Point and Menora Miv Hld in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menora Miv Hld and Capital Point 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 Capital Point are associated (or correlated) with Menora Miv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menora Miv Hld has no effect on the direction of Capital Point i.e., Capital Point and Menora Miv go up and down completely randomly.

Pair Corralation between Capital Point and Menora Miv

Assuming the 90 days trading horizon Capital Point is expected to generate 1.57 times less return on investment than Menora Miv. In addition to that, Capital Point is 1.2 times more volatile than Menora Miv Hld. It trades about 0.25 of its total potential returns per unit of risk. Menora Miv Hld is currently generating about 0.47 per unit of volatility. If you would invest  1,068,165  in Menora Miv Hld on September 26, 2024 and sell it today you would earn a total of  413,835  from holding Menora Miv Hld or generate 38.74% return on investment over 90 days.

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

Capital Point  vs.  Menora Miv Hld

Capital Point

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Capital Point are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Capital Point sustained solid returns over the last few months and may actually be approaching a breakup point.

Menora Miv Hld

Risk-Adjusted Performance

36 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Menora Miv Hld are ranked lower than 36 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Menora Miv sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Capital Point and Menora Miv

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

The idea behind Capital Point and Menora Miv Hld 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.