Correlation Between Piraeus Financial and United Bankshares
Can any of the company-specific risk be diversified away by investing in both Piraeus Financial and United Bankshares 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 Piraeus Financial and United Bankshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Piraeus Financial Holdings and United Bankshares, you can compare the effects of market volatilities on Piraeus Financial and United Bankshares 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 Piraeus Financial with a short position of United Bankshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piraeus Financial and United Bankshares.
Diversification Opportunities for Piraeus Financial and United Bankshares
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Piraeus and United is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Piraeus Financial Holdings and United Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Bankshares and Piraeus Financial 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 Piraeus Financial Holdings are associated (or correlated) with United Bankshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Bankshares has no effect on the direction of Piraeus Financial i.e., Piraeus Financial and United Bankshares go up and down completely randomly.
Pair Corralation between Piraeus Financial and United Bankshares
Assuming the 90 days horizon Piraeus Financial Holdings is expected to generate 2.31 times more return on investment than United Bankshares. However, Piraeus Financial is 2.31 times more volatile than United Bankshares. It trades about 0.1 of its potential returns per unit of risk. United Bankshares is currently generating about 0.01 per unit of risk. If you would invest 211.00 in Piraeus Financial Holdings on October 29, 2024 and sell it today you would earn a total of 168.00 from holding Piraeus Financial Holdings or generate 79.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 32.12% |
| Values | Daily Returns |
Piraeus Financial Holdings vs. United Bankshares
Performance |
| Timeline |
| Piraeus Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| United Bankshares |
Piraeus Financial and United Bankshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Piraeus Financial and United Bankshares
The main advantage of trading using opposite Piraeus Financial and United Bankshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Piraeus Financial position performs unexpectedly, United Bankshares 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 United Bankshares will offset losses from the drop in United Bankshares' long position.| Piraeus Financial vs. Alpha Bank SA | Piraeus Financial vs. Eurobank Ergasias SA | Piraeus Financial vs. Piraeus Bank SA | Piraeus Financial vs. First Citizens BancShares |
| United Bankshares vs. Peoples Bancorp | United Bankshares vs. Eagle Bancorp | United Bankshares vs. Northrim BanCorp | United Bankshares vs. Pacific Premier Bancorp |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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