Correlation Between Azure Holding and Menora Mivtachim

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

By analyzing existing cross correlation between Azure Holding Group and Menora Mivtachim Holdings, you can compare the effects of market volatilities on Azure Holding and Menora Mivtachim 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 Azure Holding with a short position of Menora Mivtachim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azure Holding and Menora Mivtachim.

Diversification Opportunities for Azure Holding and Menora Mivtachim

-0.62

Correlation Coefficient

Azure Holding  Menora Mivtachim

Excellent diversification

The 3 months correlation between Azure and Menora is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Azure Holding Group and Menora Mivtachim Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menora Mivtachim Holdings and Azure Holding 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 Azure Holding Group are associated (or correlated) with Menora Mivtachim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menora Mivtachim Holdings has no effect on the direction of Azure Holding i.e., Azure Holding and Menora Mivtachim go up and down completely randomly.

Pair Corralation between Azure Holding and Menora Mivtachim

Given the investment horizon of 90 days Azure Holding Group is expected to generate 23.2 times more return on investment than Menora Mivtachim. However, Azure Holding is 23.2 times more volatile than Menora Mivtachim Holdings. It trades about 0.04 of its potential returns per unit of risk. Menora Mivtachim Holdings is currently generating about 0.13 per unit of risk. If you would invest  23.00  in Azure Holding Group on October 23, 2024 and sell it today you would lose (14.50) from holding Azure Holding Group or give up 63.04% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	93.75%
Values	Daily Returns

Azure Holding Group  vs.  Menora Mivtachim Holdings

Azure Holding Group

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Azure Holding Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Azure Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Menora Mivtachim Holdings

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Menora Mivtachim Holdings are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical indicators, Menora Mivtachim may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Azure Holding and Menora Mivtachim

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

The idea behind Azure Holding Group and Menora Mivtachim Holdings 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .