Correlation Between Kardan Real and Netanel

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

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

Diversification Opportunities for Kardan Real and Netanel

0.95

Correlation Coefficient

Kardan Real  Netanel

Almost no diversification

The 3 months correlation between Kardan and Netanel is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Kardan Real Estate and Netanel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netanel Group and Kardan Real 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 Kardan Real Estate are associated (or correlated) with Netanel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netanel Group has no effect on the direction of Kardan Real i.e., Kardan Real and Netanel go up and down completely randomly.

Pair Corralation between Kardan Real and Netanel

Assuming the 90 days trading horizon Kardan Real is expected to generate 1.34 times less return on investment than Netanel. In addition to that, Kardan Real is 1.42 times more volatile than Netanel Group. It trades about 0.16 of its total potential returns per unit of risk. Netanel Group is currently generating about 0.3 per unit of volatility. If you would invest  106,800  in Netanel Group on September 30, 2024 and sell it today you would earn a total of  24,600  from holding Netanel Group or generate 23.03% return on investment over 90 days.

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

Kardan Real Estate  vs.  Netanel Group

Kardan Real Estate

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kardan Real Estate are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Kardan Real sustained solid returns over the last few months and may actually be approaching a breakup point.

Netanel Group

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Netanel Group are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Netanel sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kardan Real and Netanel

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

The idea behind Kardan Real Estate and Netanel 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.