Correlation Between Hellenic Petroleum and Frigoglass SAIC
Can any of the company-specific risk be diversified away by investing in both Hellenic Petroleum and Frigoglass SAIC 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 Frigoglass SAIC 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 Frigoglass SAIC, you can compare the effects of market volatilities on Hellenic Petroleum and Frigoglass SAIC 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 Frigoglass SAIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hellenic Petroleum and Frigoglass SAIC.
Diversification Opportunities for Hellenic Petroleum and Frigoglass SAIC
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hellenic and Frigoglass is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hellenic Petroleum SA and Frigoglass SAIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frigoglass SAIC 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 Frigoglass SAIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frigoglass SAIC has no effect on the direction of Hellenic Petroleum i.e., Hellenic Petroleum and Frigoglass SAIC go up and down completely randomly.
Pair Corralation between Hellenic Petroleum and Frigoglass SAIC
Assuming the 90 days trading horizon Hellenic Petroleum SA is expected to generate 0.18 times more return on investment than Frigoglass SAIC. However, Hellenic Petroleum SA is 5.42 times less risky than Frigoglass SAIC. It trades about 0.06 of its potential returns per unit of risk. Frigoglass SAIC is currently generating about -0.04 per unit of risk. If you would invest 743.00 in Hellenic Petroleum SA on November 4, 2024 and sell it today you would earn a total of 6.00 from holding Hellenic Petroleum SA or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hellenic Petroleum SA vs. Frigoglass SAIC
Performance |
| Timeline |
| Hellenic Petroleum |
| Frigoglass SAIC |
Hellenic Petroleum and Frigoglass SAIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hellenic Petroleum and Frigoglass SAIC
The main advantage of trading using opposite Hellenic Petroleum and Frigoglass SAIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hellenic Petroleum position performs unexpectedly, Frigoglass SAIC 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 Frigoglass SAIC will offset losses from the drop in Frigoglass SAIC'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 |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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