Correlation Between Athens General and Flexopack Socit
Can any of the company-specific risk be diversified away by investing in both Athens General and Flexopack Socit 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 Athens General and Flexopack Socit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Athens General Composite and Flexopack Socit Anonyme, you can compare the effects of market volatilities on Athens General and Flexopack Socit 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 Athens General with a short position of Flexopack Socit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athens General and Flexopack Socit.
Diversification Opportunities for Athens General and Flexopack Socit
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Athens and Flexopack is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Athens General Composite and Flexopack Socit Anonyme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flexopack Socit Anonyme and Athens General 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 Athens General Composite are associated (or correlated) with Flexopack Socit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flexopack Socit Anonyme has no effect on the direction of Athens General i.e., Athens General and Flexopack Socit go up and down completely randomly.
Pair Corralation between Athens General and Flexopack Socit
Assuming the 90 days trading horizon Athens General Composite is expected to generate 0.54 times more return on investment than Flexopack Socit. However, Athens General Composite is 1.84 times less risky than Flexopack Socit. It trades about 0.06 of its potential returns per unit of risk. Flexopack Socit Anonyme is currently generating about 0.01 per unit of risk. If you would invest 112,190 in Athens General Composite on August 29, 2024 and sell it today you would earn a total of 28,615 from holding Athens General Composite or generate 25.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athens General Composite vs. Flexopack Socit Anonyme
Performance |
| Timeline |
Athens General and Flexopack Socit Volatility Contrast
Predicted Return Density |
| Returns |
Athens General Composite
Pair trading matchups for Athens General
Flexopack Socit Anonyme
Pair trading matchups for Flexopack Socit
Pair Trading with Athens General and Flexopack Socit
The main advantage of trading using opposite Athens General and Flexopack Socit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athens General position performs unexpectedly, Flexopack Socit 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 Flexopack Socit will offset losses from the drop in Flexopack Socit's long position.| Athens General vs. Profile Systems Software | Athens General vs. Sidma SA Steel | Athens General vs. Eurobank Ergasias Services | Athens General vs. Elton International Trading |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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