Correlation Between IBI Mutual and Altshuler Shaham

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

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

Diversification Opportunities for IBI Mutual and Altshuler Shaham

0.33

Correlation Coefficient

IBI Mutual  Altshuler Shaham

Weak diversification

The 3 months correlation between IBI and Altshuler is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding IBI Mutual Funds and Altshuler Shaham Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altshuler Shaham Fin and IBI Mutual 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 IBI Mutual Funds are associated (or correlated) with Altshuler Shaham. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altshuler Shaham Fin has no effect on the direction of IBI Mutual i.e., IBI Mutual and Altshuler Shaham go up and down completely randomly.

Pair Corralation between IBI Mutual and Altshuler Shaham

Assuming the 90 days trading horizon IBI Mutual Funds is expected to under-perform the Altshuler Shaham. But the stock apears to be less risky and, when comparing its historical volatility, IBI Mutual Funds is 1.22 times less risky than Altshuler Shaham. The stock trades about -0.05 of its potential returns per unit of risk. The Altshuler Shaham Financial is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  60,180  in Altshuler Shaham Financial on December 24, 2024 and sell it today you would lose (2,620) from holding Altshuler Shaham Financial or give up 4.35% of portfolio value over 90 days.

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

IBI Mutual Funds  vs.  Altshuler Shaham Financial

IBI Mutual Funds

Risk-Adjusted Performance

Very Weak

Over the last 90 days IBI Mutual Funds has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, IBI Mutual is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Altshuler Shaham Fin

Risk-Adjusted Performance

Very Weak

Over the last 90 days Altshuler Shaham Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Altshuler Shaham is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IBI Mutual and Altshuler Shaham

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

The idea behind IBI Mutual Funds and Altshuler Shaham Financial 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.