Correlation Between General Commercial and Daios Plastics
Can any of the company-specific risk be diversified away by investing in both General Commercial and Daios Plastics 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 General Commercial and Daios Plastics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Commercial Industrial and Daios Plastics SA, you can compare the effects of market volatilities on General Commercial and Daios Plastics 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 General Commercial with a short position of Daios Plastics. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Commercial and Daios Plastics.
Diversification Opportunities for General Commercial and Daios Plastics
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between General and Daios is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding General Commercial Industrial and Daios Plastics SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daios Plastics SA and General Commercial 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 General Commercial Industrial are associated (or correlated) with Daios Plastics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daios Plastics SA has no effect on the direction of General Commercial i.e., General Commercial and Daios Plastics go up and down completely randomly.
Pair Corralation between General Commercial and Daios Plastics
Assuming the 90 days trading horizon General Commercial Industrial is expected to generate 0.63 times more return on investment than Daios Plastics. However, General Commercial Industrial is 1.58 times less risky than Daios Plastics. It trades about 0.17 of its potential returns per unit of risk. Daios Plastics SA is currently generating about 0.04 per unit of risk. If you would invest 144.00 in General Commercial Industrial on November 27, 2024 and sell it today you would earn a total of 11.00 from holding General Commercial Industrial or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Commercial Industrial vs. Daios Plastics SA
Performance |
| Timeline |
| General Commercial |
| Daios Plastics SA |
General Commercial and Daios Plastics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Commercial and Daios Plastics
The main advantage of trading using opposite General Commercial and Daios Plastics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Commercial position performs unexpectedly, Daios Plastics 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 Daios Plastics will offset losses from the drop in Daios Plastics' long position.| General Commercial vs. Ekter SA | General Commercial vs. Elton International Trading | General Commercial vs. Piraeus Port Authority | General Commercial vs. Hellenic Petroleum SA |
| Daios Plastics vs. Ktima Kostas Lazaridis | Daios Plastics vs. Centric Holdings SA | Daios Plastics vs. Trastor Real Estate | Daios Plastics vs. As Commercial Industrial |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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