Correlation Between BranchOut Food and Eltek

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

By analyzing existing cross correlation between BranchOut Food Common and Eltek, you can compare the effects of market volatilities on BranchOut Food and Eltek 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 BranchOut Food with a short position of Eltek. Check out your portfolio center. Please also check ongoing floating volatility patterns of BranchOut Food and Eltek.

Diversification Opportunities for BranchOut Food and Eltek

0.32

Correlation Coefficient

BranchOut Food  Eltek

Weak diversification

The 3 months correlation between BranchOut and Eltek is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding BranchOut Food Common and Eltek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eltek and BranchOut Food 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 BranchOut Food Common are associated (or correlated) with Eltek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eltek has no effect on the direction of BranchOut Food i.e., BranchOut Food and Eltek go up and down completely randomly.

Pair Corralation between BranchOut Food and Eltek

Considering the 90-day investment horizon BranchOut Food Common is expected to under-perform the Eltek. In addition to that, BranchOut Food is 1.8 times more volatile than Eltek. It trades about -0.01 of its total potential returns per unit of risk. Eltek is currently generating about 0.01 per unit of volatility. If you would invest  1,100  in Eltek on October 17, 2024 and sell it today you would earn a total of  0.00  from holding Eltek or generate 0.0% return on investment over 90 days.

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

BranchOut Food Common  vs.  Eltek

BranchOut Food Common

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BranchOut Food Common are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, BranchOut Food may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Eltek

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eltek are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Eltek is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with BranchOut Food and Eltek

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

The idea behind BranchOut Food Common and Eltek 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.