Correlation Between Amir Marketing and ICL Israel
Can any of the company-specific risk be diversified away by investing in both Amir Marketing and ICL 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 Amir Marketing and ICL Israel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amir Marketing and and ICL Israel Chemicals, you can compare the effects of market volatilities on Amir Marketing and ICL 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 Amir Marketing with a short position of ICL Israel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amir Marketing and ICL Israel.
Diversification Opportunities for Amir Marketing and ICL Israel
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amir and ICL is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Amir Marketing and and ICL Israel Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICL Israel Chemicals and Amir Marketing 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 Amir Marketing and are associated (or correlated) with ICL Israel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICL Israel Chemicals has no effect on the direction of Amir Marketing i.e., Amir Marketing and ICL Israel go up and down completely randomly.
Pair Corralation between Amir Marketing and ICL Israel
Assuming the 90 days trading horizon Amir Marketing and is expected to generate 0.98 times more return on investment than ICL Israel. However, Amir Marketing and is 1.02 times less risky than ICL Israel. It trades about -0.04 of its potential returns per unit of risk. ICL Israel Chemicals is currently generating about -0.05 per unit of risk. If you would invest 361,601 in Amir Marketing and on January 19, 2024 and sell it today you would lose (126,001) from holding Amir Marketing and or give up 34.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amir Marketing and vs. ICL Israel Chemicals
Performance |
| Timeline |
| Amir Marketing |
| ICL Israel Chemicals |
Amir Marketing and ICL Israel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amir Marketing and ICL Israel
The main advantage of trading using opposite Amir Marketing and ICL Israel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amir Marketing position performs unexpectedly, ICL 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 ICL Israel will offset losses from the drop in ICL Israel's long position.| Amir Marketing vs. EN Shoham Business | Amir Marketing vs. Accel Solutions Group | Amir Marketing vs. Mivtach Shamir | Amir Marketing vs. Rani Zim Shopping |
| ICL Israel vs. Elbit Systems | ICL Israel vs. Bezeq Israeli Telecommunication | ICL Israel vs. Bank Hapoalim | ICL Israel vs. Teva Pharmaceutical Industries |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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