Correlation Between Space Communication and Eltek

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

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

Diversification Opportunities for Space Communication and Eltek

0.0

Correlation Coefficient

Space Communication  Eltek

Pay attention - limited upside

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

Pair Corralation between Space Communication and Eltek

If you would invest  20.00  in Space Communication on December 20, 2024 and sell it today you would earn a total of  0.00  from holding Space Communication or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	93.65%
Values	Daily Returns

Space Communication  vs.  Eltek

Space Communication

Risk-Adjusted Performance

Very Weak

Over the last 90 days Space Communication has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, Space Communication is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Eltek

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eltek has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Space Communication and Eltek

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

The idea behind Space Communication and Eltek 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.