Correlation Between Aegean Airlines and Hellenic Petroleum
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Hellenic Petroleum 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 Aegean Airlines and Hellenic Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegean Airlines SA and Hellenic Petroleum SA, you can compare the effects of market volatilities on Aegean Airlines and Hellenic Petroleum 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 Aegean Airlines with a short position of Hellenic Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Hellenic Petroleum.
Diversification Opportunities for Aegean Airlines and Hellenic Petroleum
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aegean and Hellenic is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Hellenic Petroleum SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hellenic Petroleum and Aegean Airlines 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 Aegean Airlines SA are associated (or correlated) with Hellenic Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hellenic Petroleum has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Hellenic Petroleum go up and down completely randomly.
Pair Corralation between Aegean Airlines and Hellenic Petroleum
Assuming the 90 days trading horizon Aegean Airlines SA is expected to under-perform the Hellenic Petroleum. In addition to that, Aegean Airlines is 1.05 times more volatile than Hellenic Petroleum SA. It trades about -0.09 of its total potential returns per unit of risk. Hellenic Petroleum SA is currently generating about 0.02 per unit of volatility. If you would invest 672.00 in Hellenic Petroleum SA on August 31, 2024 and sell it today you would earn a total of 3.00 from holding Hellenic Petroleum SA or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. Hellenic Petroleum SA
Performance |
| Timeline |
| Aegean Airlines SA |
| Hellenic Petroleum |
Aegean Airlines and Hellenic Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Hellenic Petroleum
The main advantage of trading using opposite Aegean Airlines and Hellenic Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Hellenic Petroleum 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 Hellenic Petroleum will offset losses from the drop in Hellenic Petroleum's long position.| Aegean Airlines vs. Mytilineos SA | Aegean Airlines vs. Greek Organization of | Aegean Airlines vs. Motor Oil Corinth | Aegean Airlines vs. Alpha Services and |
| Hellenic Petroleum vs. Motor Oil Corinth | Hellenic Petroleum vs. Greek Organization of | Hellenic Petroleum vs. Mytilineos SA | Hellenic Petroleum vs. Hellenic Telecommunications Organization |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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