Correlation Between Tedea Technological and Altshuler Shaham

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

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

Diversification Opportunities for Tedea Technological and Altshuler Shaham

0.02

Correlation Coefficient

Tedea Technological  Altshuler Shaham

Significant diversification

The 3 months correlation between Tedea and Altshuler is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Tedea Technological Developmen 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 Tedea Technological 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 Tedea Technological Development 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 Tedea Technological i.e., Tedea Technological and Altshuler Shaham go up and down completely randomly.

Pair Corralation between Tedea Technological and Altshuler Shaham

Assuming the 90 days trading horizon Tedea Technological Development is expected to under-perform the Altshuler Shaham. In addition to that, Tedea Technological is 1.49 times more volatile than Altshuler Shaham Financial. It trades about -0.04 of its total potential returns per unit of risk. Altshuler Shaham Financial is currently generating about 0.01 per unit of volatility. If you would invest  64,621  in Altshuler Shaham Financial on October 26, 2024 and sell it today you would lose (2,381) from holding Altshuler Shaham Financial or give up 3.68% of portfolio value over 90 days.

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

Tedea Technological Developmen  vs.  Altshuler Shaham Financial

Tedea Technological

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tedea Technological Development has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Altshuler Shaham Fin

Risk-Adjusted Performance

0 of 100

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 Tedea Technological and Altshuler Shaham

The main advantage of trading using opposite Tedea Technological and Altshuler Shaham positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tedea Technological 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 Tedea Technological Development 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.