Correlation Between Hellenic Petroleum and Thessaloniki Water
Can any of the company-specific risk be diversified away by investing in both Hellenic Petroleum and Thessaloniki Water 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 Hellenic Petroleum and Thessaloniki Water into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hellenic Petroleum SA and Thessaloniki Water Supply, you can compare the effects of market volatilities on Hellenic Petroleum and Thessaloniki Water 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 Hellenic Petroleum with a short position of Thessaloniki Water. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hellenic Petroleum and Thessaloniki Water.
Diversification Opportunities for Hellenic Petroleum and Thessaloniki Water
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hellenic and Thessaloniki is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Hellenic Petroleum SA and Thessaloniki Water Supply in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thessaloniki Water Supply and Hellenic Petroleum 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 Hellenic Petroleum SA are associated (or correlated) with Thessaloniki Water. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thessaloniki Water Supply has no effect on the direction of Hellenic Petroleum i.e., Hellenic Petroleum and Thessaloniki Water go up and down completely randomly.
Pair Corralation between Hellenic Petroleum and Thessaloniki Water
Assuming the 90 days trading horizon Hellenic Petroleum SA is expected to generate 0.95 times more return on investment than Thessaloniki Water. However, Hellenic Petroleum SA is 1.05 times less risky than Thessaloniki Water. It trades about 0.01 of its potential returns per unit of risk. Thessaloniki Water Supply is currently generating about -0.02 per unit of risk. If you would invest 670.00 in Hellenic Petroleum SA on August 31, 2024 and sell it today you would earn a total of 10.00 from holding Hellenic Petroleum SA or generate 1.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hellenic Petroleum SA vs. Thessaloniki Water Supply
Performance |
| Timeline |
| Hellenic Petroleum |
| Thessaloniki Water Supply |
Hellenic Petroleum and Thessaloniki Water Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hellenic Petroleum and Thessaloniki Water
The main advantage of trading using opposite Hellenic Petroleum and Thessaloniki Water positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hellenic Petroleum position performs unexpectedly, Thessaloniki Water 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 Thessaloniki Water will offset losses from the drop in Thessaloniki Water's long position.| Hellenic Petroleum vs. Motor Oil Corinth | Hellenic Petroleum vs. Greek Organization of | Hellenic Petroleum vs. Mytilineos SA | Hellenic Petroleum vs. Hellenic Telecommunications Organization |
| Thessaloniki Water vs. Hellenic Petroleum SA | Thessaloniki Water vs. Mytilineos SA | Thessaloniki Water vs. Hellenic Telecommunications Organization | Thessaloniki Water vs. Public Power |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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