Correlation Between CompoSecure and Cellcom Israel

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

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

Diversification Opportunities for CompoSecure and Cellcom Israel

0.0

Correlation Coefficient

CompoSecure  Cellcom Israel

Pay attention - limited upside

The 3 months correlation between CompoSecure and Cellcom is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CompoSecure and Cellcom Israel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellcom Israel and CompoSecure 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 CompoSecure are associated (or correlated) with Cellcom Israel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellcom Israel has no effect on the direction of CompoSecure i.e., CompoSecure and Cellcom Israel go up and down completely randomly.

Pair Corralation between CompoSecure and Cellcom Israel

If you would invest  118.00  in CompoSecure on October 3, 2024 and sell it today you would earn a total of  347.00  from holding CompoSecure or generate 294.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CompoSecure  vs.  Cellcom Israel

CompoSecure

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CompoSecure are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, CompoSecure showed solid returns over the last few months and may actually be approaching a breakup point.

Cellcom Israel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cellcom Israel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Cellcom Israel 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 CompoSecure and Cellcom Israel

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

The idea behind CompoSecure and Cellcom Israel 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.