Correlation Between National Bank and Hellenic Petroleum
Can any of the company-specific risk be diversified away by investing in both National Bank and Hellenic Petroleum 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 National Bank and Hellenic Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank of and Hellenic Petroleum SA, you can compare the effects of market volatilities on National Bank and Hellenic Petroleum 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 National Bank with a short position of Hellenic Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Hellenic Petroleum.
Diversification Opportunities for National Bank and Hellenic Petroleum
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between National and Hellenic is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Hellenic Petroleum SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hellenic Petroleum and National 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 National Bank of are associated (or correlated) with Hellenic Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hellenic Petroleum has no effect on the direction of National Bank i.e., National Bank and Hellenic Petroleum go up and down completely randomly.
Pair Corralation between National Bank and Hellenic Petroleum
Assuming the 90 days trading horizon National Bank of is expected to generate 1.32 times more return on investment than Hellenic Petroleum. However, National Bank is 1.32 times more volatile than Hellenic Petroleum SA. It trades about 0.04 of its potential returns per unit of risk. Hellenic Petroleum SA is currently generating about 0.0 per unit of risk. If you would invest 578.00 in National Bank of on August 28, 2024 and sell it today you would earn a total of 105.00 from holding National Bank of or generate 18.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank of vs. Hellenic Petroleum SA
Performance |
| Timeline |
| National Bank |
| Hellenic Petroleum |
National Bank and Hellenic Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Hellenic Petroleum
The main advantage of trading using opposite National Bank and Hellenic Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Hellenic Petroleum 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 Hellenic Petroleum will offset losses from the drop in Hellenic Petroleum's long position.| National Bank vs. Alpha Services and | National Bank vs. Eurobank Ergasias Services | National Bank vs. Piraeus Financial Holdings | National Bank vs. Greek Organization of |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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