Correlation Between Aegean Airlines and Hellenic Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Hellenic Telecommunicatio 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 Telecommunicatio 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 Telecommunications Organization, you can compare the effects of market volatilities on Aegean Airlines and Hellenic Telecommunicatio 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 Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Hellenic Telecommunicatio.
Diversification Opportunities for Aegean Airlines and Hellenic Telecommunicatio
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aegean and Hellenic is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Hellenic Telecommunications Or in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hellenic Telecommunicatio 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 Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hellenic Telecommunicatio has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Hellenic Telecommunicatio go up and down completely randomly.
Pair Corralation between Aegean Airlines and Hellenic Telecommunicatio
Assuming the 90 days trading horizon Aegean Airlines SA is expected to under-perform the Hellenic Telecommunicatio. But the stock apears to be less risky and, when comparing its historical volatility, Aegean Airlines SA is 1.0 times less risky than Hellenic Telecommunicatio. The stock trades about -0.16 of its potential returns per unit of risk. The Hellenic Telecommunications Organization is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 1,517 in Hellenic Telecommunications Organization on September 1, 2024 and sell it today you would lose (23.00) from holding Hellenic Telecommunications Organization or give up 1.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. Hellenic Telecommunications Or
Performance |
| Timeline |
| Aegean Airlines SA |
| Hellenic Telecommunicatio |
Aegean Airlines and Hellenic Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Hellenic Telecommunicatio
The main advantage of trading using opposite Aegean Airlines and Hellenic Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Hellenic Telecommunicatio 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 Telecommunicatio will offset losses from the drop in Hellenic Telecommunicatio'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 Telecommunicatio vs. Greek Organization of | Hellenic Telecommunicatio vs. Mytilineos SA | Hellenic Telecommunicatio vs. Public Power | Hellenic Telecommunicatio vs. Motor Oil Corinth |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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