Correlation Between Hellenic Telecommunicatio and SwissCom
Can any of the company-specific risk be diversified away by investing in both Hellenic Telecommunicatio and SwissCom 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 Hellenic Telecommunicatio and SwissCom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hellenic Telecommunications Org and SwissCom AG, you can compare the effects of market volatilities on Hellenic Telecommunicatio and SwissCom 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 Hellenic Telecommunicatio with a short position of SwissCom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hellenic Telecommunicatio and SwissCom.
Diversification Opportunities for Hellenic Telecommunicatio and SwissCom
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hellenic and SwissCom is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Hellenic Telecommunications Or and SwissCom AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SwissCom AG and Hellenic Telecommunicatio 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 Hellenic Telecommunications Org are associated (or correlated) with SwissCom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SwissCom AG has no effect on the direction of Hellenic Telecommunicatio i.e., Hellenic Telecommunicatio and SwissCom go up and down completely randomly.
Pair Corralation between Hellenic Telecommunicatio and SwissCom
Assuming the 90 days horizon Hellenic Telecommunications Org is expected to generate 1.42 times more return on investment than SwissCom. However, Hellenic Telecommunicatio is 1.42 times more volatile than SwissCom AG. It trades about -0.13 of its potential returns per unit of risk. SwissCom AG is currently generating about -0.41 per unit of risk. If you would invest 836.00 in Hellenic Telecommunications Org on August 28, 2024 and sell it today you would lose (54.00) from holding Hellenic Telecommunications Org or give up 6.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hellenic Telecommunications Or vs. SwissCom AG
Performance |
| Timeline |
| Hellenic Telecommunicatio |
| SwissCom AG |
Hellenic Telecommunicatio and SwissCom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hellenic Telecommunicatio and SwissCom
The main advantage of trading using opposite Hellenic Telecommunicatio and SwissCom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hellenic Telecommunicatio position performs unexpectedly, SwissCom 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 SwissCom will offset losses from the drop in SwissCom's long position.| Hellenic Telecommunicatio vs. HUMANA INC | Hellenic Telecommunicatio vs. SCOR PK | Hellenic Telecommunicatio vs. Aquagold International | Hellenic Telecommunicatio vs. Barloworld Ltd ADR |
| SwissCom vs. HUMANA INC | SwissCom vs. SCOR PK | SwissCom vs. Aquagold International | SwissCom vs. Barloworld Ltd ADR |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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