Correlation Between Athens General and Titan Cement
Can any of the company-specific risk be diversified away by investing in both Athens General and Titan Cement 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 Titan Cement 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 Titan Cement International, you can compare the effects of market volatilities on Athens General and Titan Cement 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 Titan Cement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athens General and Titan Cement.
Diversification Opportunities for Athens General and Titan Cement
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Athens and Titan is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Athens General Composite and Titan Cement International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titan Cement Interna 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 Titan Cement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titan Cement Interna has no effect on the direction of Athens General i.e., Athens General and Titan Cement go up and down completely randomly.
Pair Corralation between Athens General and Titan Cement
Assuming the 90 days trading horizon Athens General Composite is expected to under-perform the Titan Cement. But the index apears to be less risky and, when comparing its historical volatility, Athens General Composite is 2.37 times less risky than Titan Cement. The index trades about -0.03 of its potential returns per unit of risk. The Titan Cement International is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 3,235 in Titan Cement International on August 24, 2024 and sell it today you would earn a total of 475.00 from holding Titan Cement International or generate 14.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athens General Composite vs. Titan Cement International
Performance |
| Timeline |
Athens General and Titan Cement Volatility Contrast
Predicted Return Density |
| Returns |
Athens General Composite
Pair trading matchups for Athens General
Titan Cement International
Pair trading matchups for Titan Cement
Pair Trading with Athens General and Titan Cement
The main advantage of trading using opposite Athens General and Titan Cement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athens General position performs unexpectedly, Titan Cement 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 Titan Cement will offset losses from the drop in Titan Cement's long position.| Athens General vs. Interlife General Insurance | Athens General vs. CPI Computer Peripherals | Athens General vs. Thrace Plastics Holding | Athens General vs. Marfin Investment Group |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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