Correlation Between Piraeus Bank and Merchants Marine
Can any of the company-specific risk be diversified away by investing in both Piraeus Bank and Merchants Marine 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 Bank and Merchants Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Piraeus Bank SA and Merchants Marine Bancorp, you can compare the effects of market volatilities on Piraeus Bank and Merchants Marine 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 Bank with a short position of Merchants Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piraeus Bank and Merchants Marine.
Diversification Opportunities for Piraeus Bank and Merchants Marine
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Piraeus and Merchants is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Piraeus Bank SA and Merchants Marine Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merchants Marine Bancorp and Piraeus Bank 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 Bank SA are associated (or correlated) with Merchants Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merchants Marine Bancorp has no effect on the direction of Piraeus Bank i.e., Piraeus Bank and Merchants Marine go up and down completely randomly.
Pair Corralation between Piraeus Bank and Merchants Marine
Assuming the 90 days horizon Piraeus Bank SA is expected to generate 1.36 times more return on investment than Merchants Marine. However, Piraeus Bank is 1.36 times more volatile than Merchants Marine Bancorp. It trades about 0.04 of its potential returns per unit of risk. Merchants Marine Bancorp is currently generating about -0.03 per unit of risk. If you would invest 315.00 in Piraeus Bank SA on September 4, 2024 and sell it today you would earn a total of 69.00 from holding Piraeus Bank SA or generate 21.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 62.6% |
| Values | Daily Returns |
Piraeus Bank SA vs. Merchants Marine Bancorp
Performance |
| Timeline |
| Piraeus Bank SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Merchants Marine Bancorp |
Piraeus Bank and Merchants Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Piraeus Bank and Merchants Marine
The main advantage of trading using opposite Piraeus Bank and Merchants Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Piraeus Bank position performs unexpectedly, Merchants Marine 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 Merchants Marine will offset losses from the drop in Merchants Marine's long position.| Piraeus Bank vs. Bankinter SA ADR | Piraeus Bank vs. JAPAN POST BANK | Piraeus Bank vs. JAPAN POST BANK | Piraeus Bank vs. Eurobank Ergasias Services |
| Merchants Marine vs. Mission Valley Bancorp | Merchants Marine vs. Harbor Bankshares | Merchants Marine vs. MF Bancorp | Merchants Marine vs. MNB Holdings Corp |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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