Correlation Between Altshuler Shaham and Payment Financial

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

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

Diversification Opportunities for Altshuler Shaham and Payment Financial

0.57

Correlation Coefficient

Altshuler Shaham  Payment Financial

Very weak diversification

The 3 months correlation between Altshuler and Payment is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Altshuler Shaham Financial and Payment Financial Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payment Financial and Altshuler Shaham 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 Altshuler Shaham Financial are associated (or correlated) with Payment Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payment Financial has no effect on the direction of Altshuler Shaham i.e., Altshuler Shaham and Payment Financial go up and down completely randomly.

Pair Corralation between Altshuler Shaham and Payment Financial

Assuming the 90 days trading horizon Altshuler Shaham is expected to generate 3.08 times less return on investment than Payment Financial. But when comparing it to its historical volatility, Altshuler Shaham Financial is 1.78 times less risky than Payment Financial. It trades about 0.14 of its potential returns per unit of risk. Payment Financial Technologies is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  25,217  in Payment Financial Technologies on October 9, 2024 and sell it today you would earn a total of  14,713  from holding Payment Financial Technologies or generate 58.35% return on investment over 90 days.

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

Altshuler Shaham Financial  vs.  Payment Financial Technologies

Altshuler Shaham Fin

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Altshuler Shaham Financial are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Altshuler Shaham sustained solid returns over the last few months and may actually be approaching a breakup point.

Payment Financial

Risk-Adjusted Performance

19 of 100

Solid

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

Pair Trading with Altshuler Shaham and Payment Financial

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

The idea behind Altshuler Shaham Financial and Payment Financial Technologies 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.