Correlation Between General Commercial and Vogiatzoglou Systems
Can any of the company-specific risk be diversified away by investing in both General Commercial and Vogiatzoglou Systems 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 Vogiatzoglou Systems 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 Vogiatzoglou Systems SA, you can compare the effects of market volatilities on General Commercial and Vogiatzoglou Systems 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 Vogiatzoglou Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Commercial and Vogiatzoglou Systems.
Diversification Opportunities for General Commercial and Vogiatzoglou Systems
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between General and Vogiatzoglou is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding General Commercial Industrial and Vogiatzoglou Systems SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vogiatzoglou Systems 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 Vogiatzoglou Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vogiatzoglou Systems has no effect on the direction of General Commercial i.e., General Commercial and Vogiatzoglou Systems go up and down completely randomly.
Pair Corralation between General Commercial and Vogiatzoglou Systems
Assuming the 90 days trading horizon General Commercial Industrial is expected to under-perform the Vogiatzoglou Systems. In addition to that, General Commercial is 1.11 times more volatile than Vogiatzoglou Systems SA. It trades about -0.05 of its total potential returns per unit of risk. Vogiatzoglou Systems SA is currently generating about 0.0 per unit of volatility. If you would invest 224.00 in Vogiatzoglou Systems SA on September 3, 2024 and sell it today you would lose (4.00) from holding Vogiatzoglou Systems SA or give up 1.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Commercial Industrial vs. Vogiatzoglou Systems SA
Performance |
| Timeline |
| General Commercial |
| Vogiatzoglou Systems |
General Commercial and Vogiatzoglou Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Commercial and Vogiatzoglou Systems
The main advantage of trading using opposite General Commercial and Vogiatzoglou Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Commercial position performs unexpectedly, Vogiatzoglou Systems 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 Vogiatzoglou Systems will offset losses from the drop in Vogiatzoglou Systems' 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 |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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