Correlation Between Libra Insurance and Altshuler Shaham

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

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

Diversification Opportunities for Libra Insurance and Altshuler Shaham

0.83

Correlation Coefficient

Libra Insurance  Altshuler Shaham

Very poor diversification

The 3 months correlation between Libra and Altshuler is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Libra Insurance 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 Libra Insurance 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 Libra Insurance 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 Libra Insurance i.e., Libra Insurance and Altshuler Shaham go up and down completely randomly.

Pair Corralation between Libra Insurance and Altshuler Shaham

Assuming the 90 days trading horizon Libra Insurance is expected to generate 1.2 times more return on investment than Altshuler Shaham. However, Libra Insurance is 1.2 times more volatile than Altshuler Shaham Financial. It trades about 0.25 of its potential returns per unit of risk. Altshuler Shaham Financial is currently generating about 0.06 per unit of risk. If you would invest  25,666  in Libra Insurance on September 14, 2024 and sell it today you would earn a total of  74,734  from holding Libra Insurance or generate 291.18% return on investment over 90 days.

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

Libra Insurance  vs.  Altshuler Shaham Financial

Libra Insurance

Risk-Adjusted Performance

32 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Libra Insurance are ranked lower than 32 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Libra Insurance sustained solid returns over the last few months and may actually be approaching a breakup point.

Altshuler Shaham Fin

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Altshuler Shaham Financial are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Altshuler Shaham sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Libra Insurance and Altshuler Shaham

The main advantage of trading using opposite Libra Insurance and Altshuler Shaham positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Libra Insurance 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 Libra Insurance 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.

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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..