Correlation Between Golan Plastic and Cellcom Israel
Can any of the company-specific risk be diversified away by investing in both Golan Plastic and Cellcom Israel 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 Golan Plastic and Cellcom Israel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golan Plastic and Cellcom Israel, you can compare the effects of market volatilities on Golan Plastic and Cellcom Israel 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 Golan Plastic with a short position of Cellcom Israel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golan Plastic and Cellcom Israel.
Diversification Opportunities for Golan Plastic and Cellcom Israel
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Golan and Cellcom is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Golan Plastic and Cellcom Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellcom Israel and Golan Plastic 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 Golan Plastic are associated (or correlated) with Cellcom Israel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellcom Israel has no effect on the direction of Golan Plastic i.e., Golan Plastic and Cellcom Israel go up and down completely randomly.
Pair Corralation between Golan Plastic and Cellcom Israel
Assuming the 90 days trading horizon Golan Plastic is expected to generate 1.09 times more return on investment than Cellcom Israel. However, Golan Plastic is 1.09 times more volatile than Cellcom Israel. It trades about 0.34 of its potential returns per unit of risk. Cellcom Israel is currently generating about 0.24 per unit of risk. If you would invest 93,900 in Golan Plastic on September 14, 2024 and sell it today you would earn a total of 42,700 from holding Golan Plastic or generate 45.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Golan Plastic vs. Cellcom Israel
Performance |
Timeline |
Golan Plastic |
Cellcom Israel |
Golan Plastic and Cellcom Israel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Golan Plastic and Cellcom Israel
The main advantage of trading using opposite Golan Plastic and Cellcom Israel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golan Plastic position performs unexpectedly, Cellcom Israel 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 Cellcom Israel will offset losses from the drop in Cellcom Israel's long position.Golan Plastic vs. Aran Research and | Golan Plastic vs. Al Bad Massuot Yitzhak | Golan Plastic vs. Analyst IMS Investment |
Cellcom Israel vs. More Mutual Funds | Cellcom Israel vs. Golan Plastic | Cellcom Israel vs. Adgar Investments and | Cellcom Israel vs. Harel Insurance Investments |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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