Correlation Between Interlife General and Bank of Greece
Can any of the company-specific risk be diversified away by investing in both Interlife General and Bank of Greece 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 Interlife General and Bank of Greece into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interlife General Insurance and Bank of Greece, you can compare the effects of market volatilities on Interlife General and Bank of Greece 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 Interlife General with a short position of Bank of Greece. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interlife General and Bank of Greece.
Diversification Opportunities for Interlife General and Bank of Greece
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Interlife and Bank is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Interlife General Insurance and Bank of Greece in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Greece and Interlife General 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 Interlife General Insurance are associated (or correlated) with Bank of Greece. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Greece has no effect on the direction of Interlife General i.e., Interlife General and Bank of Greece go up and down completely randomly.
Pair Corralation between Interlife General and Bank of Greece
Assuming the 90 days trading horizon Interlife General Insurance is expected to under-perform the Bank of Greece. In addition to that, Interlife General is 1.04 times more volatile than Bank of Greece. It trades about -0.16 of its total potential returns per unit of risk. Bank of Greece is currently generating about -0.11 per unit of volatility. If you would invest 1,335 in Bank of Greece on August 28, 2024 and sell it today you would lose (25.00) from holding Bank of Greece or give up 1.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Interlife General Insurance vs. Bank of Greece
Performance |
| Timeline |
| Interlife General |
| Bank of Greece |
Interlife General and Bank of Greece Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interlife General and Bank of Greece
The main advantage of trading using opposite Interlife General and Bank of Greece positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interlife General position performs unexpectedly, Bank of Greece 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 Bank of Greece will offset losses from the drop in Bank of Greece's long position.| Interlife General vs. Admie Holding SA | Interlife General vs. Coca Cola HBC AG | Interlife General vs. Quest Holdings SA | Interlife General vs. Motor Oil Corinth |
| Bank of Greece vs. Profile Systems Software | Bank of Greece vs. Elvalhalcor Hellenic Copper | Bank of Greece vs. CPI Computer Peripherals | Bank of Greece vs. Optima bank 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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