Correlation Between Eurobank Ergasias and Lumbee Guaranty
Can any of the company-specific risk be diversified away by investing in both Eurobank Ergasias and Lumbee Guaranty 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 Eurobank Ergasias and Lumbee Guaranty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eurobank Ergasias Services and Lumbee Guaranty Bank, you can compare the effects of market volatilities on Eurobank Ergasias and Lumbee Guaranty 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 Eurobank Ergasias with a short position of Lumbee Guaranty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eurobank Ergasias and Lumbee Guaranty.
Diversification Opportunities for Eurobank Ergasias and Lumbee Guaranty
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eurobank and Lumbee is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Eurobank Ergasias Services and Lumbee Guaranty Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumbee Guaranty Bank and Eurobank Ergasias 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 Eurobank Ergasias Services are associated (or correlated) with Lumbee Guaranty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumbee Guaranty Bank has no effect on the direction of Eurobank Ergasias i.e., Eurobank Ergasias and Lumbee Guaranty go up and down completely randomly.
Pair Corralation between Eurobank Ergasias and Lumbee Guaranty
Assuming the 90 days horizon Eurobank Ergasias Services is expected to generate 1.85 times more return on investment than Lumbee Guaranty. However, Eurobank Ergasias is 1.85 times more volatile than Lumbee Guaranty Bank. It trades about 0.07 of its potential returns per unit of risk. Lumbee Guaranty Bank is currently generating about 0.01 per unit of risk. If you would invest 101.00 in Eurobank Ergasias Services on September 2, 2024 and sell it today you would earn a total of 108.00 from holding Eurobank Ergasias Services or generate 106.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 65.93% |
| Values | Daily Returns |
Eurobank Ergasias Services vs. Lumbee Guaranty Bank
Performance |
| Timeline |
| Eurobank Ergasias |
| Lumbee Guaranty Bank |
Eurobank Ergasias and Lumbee Guaranty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eurobank Ergasias and Lumbee Guaranty
The main advantage of trading using opposite Eurobank Ergasias and Lumbee Guaranty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eurobank Ergasias position performs unexpectedly, Lumbee Guaranty 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 Lumbee Guaranty will offset losses from the drop in Lumbee Guaranty's long position.| Eurobank Ergasias vs. FiscalNote Holdings | Eurobank Ergasias vs. Rumble Inc | Eurobank Ergasias vs. Getty Images Holdings | Eurobank Ergasias vs. Definitive Healthcare Corp |
| Lumbee Guaranty vs. Mission Valley Bancorp | Lumbee Guaranty vs. Nmb Financial Corp | Lumbee Guaranty vs. Japan Post Holdings | Lumbee Guaranty 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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