Correlation Between National Bank and Autohellas
Can any of the company-specific risk be diversified away by investing in both National Bank and Autohellas 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 Autohellas 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 Autohellas SA, you can compare the effects of market volatilities on National Bank and Autohellas 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 Autohellas. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Autohellas.
Diversification Opportunities for National Bank and Autohellas
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between National and Autohellas is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Autohellas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohellas SA 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 Autohellas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohellas SA has no effect on the direction of National Bank i.e., National Bank and Autohellas go up and down completely randomly.
Pair Corralation between National Bank and Autohellas
Assuming the 90 days trading horizon National Bank of is expected to generate 1.09 times more return on investment than Autohellas. However, National Bank is 1.09 times more volatile than Autohellas SA. It trades about -0.17 of its potential returns per unit of risk. Autohellas SA is currently generating about -0.26 per unit of risk. If you would invest 726.00 in National Bank of on August 28, 2024 and sell it today you would lose (43.00) from holding National Bank of or give up 5.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank of vs. Autohellas SA
Performance |
| Timeline |
| National Bank |
| Autohellas SA |
National Bank and Autohellas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Autohellas
The main advantage of trading using opposite National Bank and Autohellas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Autohellas 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 Autohellas will offset losses from the drop in Autohellas' 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 |
| Autohellas vs. National Bank of | Autohellas vs. N Leventeris SA | Autohellas vs. Eurobank Ergasias Services | Autohellas vs. Vogiatzoglou Systems SA |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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