Correlation Between Karelia Tobacco and Athens Medical
Can any of the company-specific risk be diversified away by investing in both Karelia Tobacco and Athens Medical 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 Karelia Tobacco and Athens Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Karelia Tobacco and Athens Medical CSA, you can compare the effects of market volatilities on Karelia Tobacco and Athens Medical 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 Karelia Tobacco with a short position of Athens Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karelia Tobacco and Athens Medical.
Diversification Opportunities for Karelia Tobacco and Athens Medical
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Karelia and Athens is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Karelia Tobacco and Athens Medical CSA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athens Medical CSA and Karelia Tobacco 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 Karelia Tobacco are associated (or correlated) with Athens Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athens Medical CSA has no effect on the direction of Karelia Tobacco i.e., Karelia Tobacco and Athens Medical go up and down completely randomly.
Pair Corralation between Karelia Tobacco and Athens Medical
Assuming the 90 days trading horizon Karelia Tobacco is expected to under-perform the Athens Medical. But the stock apears to be less risky and, when comparing its historical volatility, Karelia Tobacco is 1.32 times less risky than Athens Medical. The stock trades about -0.04 of its potential returns per unit of risk. The Athens Medical CSA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 148.00 in Athens Medical CSA on August 24, 2024 and sell it today you would earn a total of 5.00 from holding Athens Medical CSA or generate 3.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Karelia Tobacco vs. Athens Medical CSA
Performance |
| Timeline |
| Karelia Tobacco |
| Athens Medical CSA |
Karelia Tobacco and Athens Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Karelia Tobacco and Athens Medical
The main advantage of trading using opposite Karelia Tobacco and Athens Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karelia Tobacco position performs unexpectedly, Athens Medical 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 Athens Medical will offset losses from the drop in Athens Medical's long position.| Karelia Tobacco vs. Greek Organization of | Karelia Tobacco vs. Jumbo SA | Karelia Tobacco vs. Mytilineos SA | Karelia Tobacco vs. Motor Oil Corinth |
| Athens Medical vs. Hellenic Exchanges | Athens Medical vs. Hellenic Telecommunications Organization | Athens Medical vs. GEK TERNA Holdings | Athens Medical vs. Piraeus Port Authority |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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