Correlation Between National Bank and Athens Medical
Can any of the company-specific risk be diversified away by investing in both National Bank and Athens Medical 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 Athens Medical 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 Athens Medical CSA, you can compare the effects of market volatilities on National Bank and Athens Medical 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 Athens Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Athens Medical.
Diversification Opportunities for National Bank and Athens Medical
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between National and Athens is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Athens Medical CSA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athens Medical CSA 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 Athens Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athens Medical CSA has no effect on the direction of National Bank i.e., National Bank and Athens Medical go up and down completely randomly.
Pair Corralation between National Bank and Athens Medical
Assuming the 90 days trading horizon National Bank of is expected to generate 0.99 times more return on investment than Athens Medical. However, National Bank of is 1.01 times less risky than Athens Medical. It trades about 0.15 of its potential returns per unit of risk. Athens Medical CSA is currently generating about 0.13 per unit of risk. If you would invest 726.00 in National Bank of on October 26, 2024 and sell it today you would earn a total of 109.00 from holding National Bank of or generate 15.01% 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. Athens Medical CSA
Performance |
| Timeline |
| National Bank |
| Athens Medical CSA |
National Bank and Athens Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Athens Medical
The main advantage of trading using opposite National Bank and Athens Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Athens Medical 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 Medical will offset losses from the drop in Athens Medical's long position.| National Bank vs. Alpha Services and | National Bank vs. Piraeus Financial Holdings | National Bank vs. EL D Mouzakis | National Bank vs. Lampsa Hellenic Hotels |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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