Correlation Between Telsys and EN Shoham

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

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

Diversification Opportunities for Telsys and EN Shoham

0.03

Correlation Coefficient

Telsys  EN Shoham

Significant diversification

The 3 months correlation between Telsys and SHOM is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Telsys and EN Shoham Business in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EN Shoham Business and Telsys 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 Telsys are associated (or correlated) with EN Shoham. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EN Shoham Business has no effect on the direction of Telsys i.e., Telsys and EN Shoham go up and down completely randomly.

Pair Corralation between Telsys and EN Shoham

Assuming the 90 days trading horizon Telsys is expected to under-perform the EN Shoham. In addition to that, Telsys is 1.17 times more volatile than EN Shoham Business. It trades about -0.03 of its total potential returns per unit of risk. EN Shoham Business is currently generating about 0.05 per unit of volatility. If you would invest  79,800  in EN Shoham Business on December 30, 2024 and sell it today you would earn a total of  3,290  from holding EN Shoham Business or generate 4.12% return on investment over 90 days.

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

Telsys  vs.  EN Shoham Business

Telsys

Risk-Adjusted Performance

Very Weak

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

EN Shoham Business

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in EN Shoham Business are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, EN Shoham may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Telsys and EN Shoham

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

The idea behind Telsys and EN Shoham Business 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..