Correlation Between Elton International and Athens General
Can any of the company-specific risk be diversified away by investing in both Elton International and Athens General 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 Elton International and Athens General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elton International Trading and Athens General Composite, you can compare the effects of market volatilities on Elton International and Athens General 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 Elton International with a short position of Athens General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elton International and Athens General.
Diversification Opportunities for Elton International and Athens General
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Elton and Athens is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Elton International Trading and Athens General Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athens General Composite and Elton International 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 Elton International Trading are associated (or correlated) with Athens General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athens General Composite has no effect on the direction of Elton International i.e., Elton International and Athens General go up and down completely randomly.
Pair Corralation between Elton International and Athens General
Assuming the 90 days trading horizon Elton International Trading is expected to under-perform the Athens General. In addition to that, Elton International is 2.69 times more volatile than Athens General Composite. It trades about -0.14 of its total potential returns per unit of risk. Athens General Composite is currently generating about 0.28 per unit of volatility. If you would invest 150,661 in Athens General Composite on November 5, 2024 and sell it today you would earn a total of 4,271 from holding Athens General Composite or generate 2.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elton International Trading vs. Athens General Composite
Performance |
| Timeline |
Elton International and Athens General Volatility Contrast
Predicted Return Density |
| Returns |
Elton International Trading
Pair trading matchups for Elton International
Athens General Composite
Pair trading matchups for Athens General
Pair Trading with Elton International and Athens General
The main advantage of trading using opposite Elton International and Athens General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elton International position performs unexpectedly, Athens General 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 Athens General will offset losses from the drop in Athens General's long position.| Elton International vs. Autohellas SA | Elton International vs. Admie Holding SA | Elton International vs. Hellenic Petroleum SA | Elton International vs. Jumbo SA |
| Athens General vs. Hellenic Telecommunications Organization | Athens General vs. Thrace Plastics Holding | Athens General vs. CPI Computer Peripherals | Athens General vs. Foodlink AE |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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