Correlation Between Tefron and Leisure Portfolio

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

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

Diversification Opportunities for Tefron and Leisure Portfolio

0.0

Correlation Coefficient

Tefron  Leisure Portfolio

Pay attention - limited upside

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

Pair Corralation between Tefron and Leisure Portfolio

If you would invest (100.00) in Tefron on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Tefron or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Tefron  vs.  Leisure Portfolio Leisure

Tefron

Risk-Adjusted Performance

Very Weak

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

Leisure Portfolio Leisure

Risk-Adjusted Performance

Very Weak

Over the last 90 days Leisure Portfolio Leisure has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Leisure Portfolio is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Tefron and Leisure Portfolio

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

The idea behind Tefron and Leisure Portfolio Leisure 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.