Correlation Between ORMAT TECHNOLOGIES and ZINC MEDIA
Can any of the company-specific risk be diversified away by investing in both ORMAT TECHNOLOGIES and ZINC MEDIA 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 ZINC MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ORMAT TECHNOLOGIES and ZINC MEDIA GR, you can compare the effects of market volatilities on ORMAT TECHNOLOGIES and ZINC MEDIA 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 ZINC MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ORMAT TECHNOLOGIES and ZINC MEDIA.
Diversification Opportunities for ORMAT TECHNOLOGIES and ZINC MEDIA
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ORMAT and ZINC is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding ORMAT TECHNOLOGIES and ZINC MEDIA GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZINC MEDIA GR 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 ZINC MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZINC MEDIA GR has no effect on the direction of ORMAT TECHNOLOGIES i.e., ORMAT TECHNOLOGIES and ZINC MEDIA go up and down completely randomly.
Pair Corralation between ORMAT TECHNOLOGIES and ZINC MEDIA
Assuming the 90 days trading horizon ORMAT TECHNOLOGIES is expected to generate 0.5 times more return on investment than ZINC MEDIA. However, ORMAT TECHNOLOGIES is 1.99 times less risky than ZINC MEDIA. It trades about -0.39 of its potential returns per unit of risk. ZINC MEDIA GR is currently generating about -0.28 per unit of risk. If you would invest 7,610 in ORMAT TECHNOLOGIES on September 23, 2024 and sell it today you would lose (1,084) from holding ORMAT TECHNOLOGIES or give up 14.24% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ORMAT TECHNOLOGIES vs. ZINC MEDIA GR
Performance |
Timeline |
ORMAT TECHNOLOGIES |
ZINC MEDIA GR |
ORMAT TECHNOLOGIES and ZINC MEDIA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ORMAT TECHNOLOGIES and ZINC MEDIA
The main advantage of trading using opposite ORMAT TECHNOLOGIES and ZINC MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ORMAT TECHNOLOGIES position performs unexpectedly, ZINC MEDIA 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 ZINC MEDIA will offset losses from the drop in ZINC MEDIA's long position.ORMAT TECHNOLOGIES vs. Tencent Music Entertainment | ORMAT TECHNOLOGIES vs. Lifeway Foods | ORMAT TECHNOLOGIES vs. ZURICH INSURANCE GROUP | ORMAT TECHNOLOGIES vs. INSURANCE AUST GRP |
ZINC MEDIA vs. Tower One Wireless | ZINC MEDIA vs. Entravision Communications | ZINC MEDIA vs. Charter Communications | ZINC MEDIA vs. ORMAT TECHNOLOGIES |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Commodity Directory Find actively traded commodities issued by global exchanges | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |