Correlation Between Athens General and Lampsa Hellenic
Can any of the company-specific risk be diversified away by investing in both Athens General and Lampsa Hellenic 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 Lampsa Hellenic 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 Lampsa Hellenic Hotels, you can compare the effects of market volatilities on Athens General and Lampsa Hellenic 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 Lampsa Hellenic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athens General and Lampsa Hellenic.
Diversification Opportunities for Athens General and Lampsa Hellenic
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Athens and Lampsa is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Athens General Composite and Lampsa Hellenic Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lampsa Hellenic Hotels 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 Lampsa Hellenic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lampsa Hellenic Hotels has no effect on the direction of Athens General i.e., Athens General and Lampsa Hellenic go up and down completely randomly.
Pair Corralation between Athens General and Lampsa Hellenic
Assuming the 90 days trading horizon Athens General is expected to generate 1.39 times less return on investment than Lampsa Hellenic. But when comparing it to its historical volatility, Athens General Composite is 1.02 times less risky than Lampsa Hellenic. It trades about 0.09 of its potential returns per unit of risk. Lampsa Hellenic Hotels is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,009 in Lampsa Hellenic Hotels on August 24, 2024 and sell it today you would earn a total of 1,731 from holding Lampsa Hellenic Hotels or generate 86.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athens General Composite vs. Lampsa Hellenic Hotels
Performance |
| Timeline |
Athens General and Lampsa Hellenic Volatility Contrast
Predicted Return Density |
| Returns |
Athens General Composite
Pair trading matchups for Athens General
Lampsa Hellenic Hotels
Pair trading matchups for Lampsa Hellenic
Pair Trading with Athens General and Lampsa Hellenic
The main advantage of trading using opposite Athens General and Lampsa Hellenic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athens General position performs unexpectedly, Lampsa Hellenic 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 Lampsa Hellenic will offset losses from the drop in Lampsa Hellenic's long position.| Athens General vs. Intracom Constructions Societe | Athens General vs. Thrace Plastics Holding | Athens General vs. Logismos Information Systems | Athens General vs. Elvalhalcor Hellenic Copper |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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