Correlation Between National Bank and Technical Olympic
Can any of the company-specific risk be diversified away by investing in both National Bank and Technical Olympic 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 Technical Olympic 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 Technical Olympic SA, you can compare the effects of market volatilities on National Bank and Technical Olympic 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 Technical Olympic. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Technical Olympic.
Diversification Opportunities for National Bank and Technical Olympic
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between National and Technical is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Technical Olympic SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Technical Olympic 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 Technical Olympic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Technical Olympic has no effect on the direction of National Bank i.e., National Bank and Technical Olympic go up and down completely randomly.
Pair Corralation between National Bank and Technical Olympic
Assuming the 90 days trading horizon National Bank of is expected to generate 0.85 times more return on investment than Technical Olympic. However, National Bank of is 1.18 times less risky than Technical Olympic. It trades about 0.58 of its potential returns per unit of risk. Technical Olympic SA is currently generating about 0.39 per unit of risk. If you would invest 759.00 in National Bank of on October 24, 2024 and sell it today you would earn a total of 88.00 from holding National Bank of or generate 11.59% 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. Technical Olympic SA
Performance |
| Timeline |
| National Bank |
| Technical Olympic |
National Bank and Technical Olympic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Technical Olympic
The main advantage of trading using opposite National Bank and Technical Olympic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Technical Olympic 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 Technical Olympic will offset losses from the drop in Technical Olympic'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 |
| Technical Olympic vs. National Bank of | Technical Olympic vs. CPI Computer Peripherals | Technical Olympic vs. Eurobank Ergasias Services | Technical Olympic vs. Hellenic Telecommunications Organization |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |