Correlation Between Ormat Technologies and ICL Israel

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

By analyzing existing cross correlation between Ormat Technologies and ICL Israel Chemicals, you can compare the effects of market volatilities on Ormat Technologies 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 Ormat Technologies with a short position of ICL Israel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ormat Technologies and ICL Israel.

Diversification Opportunities for Ormat Technologies and ICL Israel

0.11

Correlation Coefficient

Ormat Technologies  ICL Israel

Average diversification

The 3 months correlation between Ormat and ICL is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ormat Technologies 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 Ormat Technologies 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 Ormat Technologies 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 Ormat Technologies i.e., Ormat Technologies and ICL Israel go up and down completely randomly.

Pair Corralation between Ormat Technologies and ICL Israel

Assuming the 90 days trading horizon Ormat Technologies is expected to generate 0.97 times more return on investment than ICL Israel. However, Ormat Technologies is 1.03 times less risky than ICL Israel. It trades about 0.18 of its potential returns per unit of risk. ICL Israel Chemicals is currently generating about -0.13 per unit of risk. If you would invest  2,575,825  in Ormat Technologies on May 6, 2025 and sell it today you would earn a total of  434,175  from holding Ormat Technologies or generate 16.86% return on investment over 90 days.

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

Ormat Technologies  vs.  ICL Israel Chemicals

Ormat Technologies

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ormat Technologies are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Ormat Technologies sustained solid returns over the last few months and may actually be approaching a breakup point.

ICL Israel Chemicals

Risk-Adjusted Performance

Very Weak

Over the last 90 days ICL Israel Chemicals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's essential indicators remain somewhat strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Ormat Technologies and ICL Israel

The main advantage of trading using opposite Ormat Technologies and ICL Israel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ormat Technologies 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.

The idea behind Ormat Technologies and ICL Israel Chemicals 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.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.