Correlation Between Mivtach Shamir and Capital Point

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

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

Diversification Opportunities for Mivtach Shamir and Capital Point

-0.81

Correlation Coefficient

Mivtach Shamir  Capital Point

Pay attention - limited upside

The 3 months correlation between Mivtach and Capital is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Mivtach Shamir and Capital Point in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Point and Mivtach Shamir 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 Mivtach Shamir are associated (or correlated) with Capital Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Point has no effect on the direction of Mivtach Shamir i.e., Mivtach Shamir and Capital Point go up and down completely randomly.

Pair Corralation between Mivtach Shamir and Capital Point

Assuming the 90 days trading horizon Mivtach Shamir is expected to generate 1.17 times more return on investment than Capital Point. However, Mivtach Shamir is 1.17 times more volatile than Capital Point. It trades about 0.16 of its potential returns per unit of risk. Capital Point is currently generating about -0.06 per unit of risk. If you would invest  1,291,675  in Mivtach Shamir on September 3, 2024 and sell it today you would earn a total of  506,325  from holding Mivtach Shamir or generate 39.2% return on investment over 90 days.

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

Mivtach Shamir  vs.  Capital Point

Mivtach Shamir

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mivtach Shamir are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Mivtach Shamir may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Capital Point

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Mivtach Shamir and Capital Point

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

The idea behind Mivtach Shamir and Capital Point 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.