Correlation Between Karelia Tobacco and Sidma SA
Can any of the company-specific risk be diversified away by investing in both Karelia Tobacco and Sidma SA 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 Sidma SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Karelia Tobacco and Sidma SA Steel, you can compare the effects of market volatilities on Karelia Tobacco and Sidma SA 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 Sidma SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karelia Tobacco and Sidma SA.
Diversification Opportunities for Karelia Tobacco and Sidma SA
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Karelia and Sidma is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Karelia Tobacco and Sidma SA Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sidma SA Steel 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 Sidma SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sidma SA Steel has no effect on the direction of Karelia Tobacco i.e., Karelia Tobacco and Sidma SA go up and down completely randomly.
Pair Corralation between Karelia Tobacco and Sidma SA
Assuming the 90 days trading horizon Karelia Tobacco is expected to generate 0.71 times more return on investment than Sidma SA. However, Karelia Tobacco is 1.41 times less risky than Sidma SA. It trades about 0.03 of its potential returns per unit of risk. Sidma SA Steel is currently generating about -0.02 per unit of risk. If you would invest 27,840 in Karelia Tobacco on August 30, 2024 and sell it today you would earn a total of 5,760 from holding Karelia Tobacco or generate 20.69% 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. Sidma SA Steel
Performance |
| Timeline |
| Karelia Tobacco |
| Sidma SA Steel |
Karelia Tobacco and Sidma SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Karelia Tobacco and Sidma SA
The main advantage of trading using opposite Karelia Tobacco and Sidma SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karelia Tobacco position performs unexpectedly, Sidma SA 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 Sidma SA will offset losses from the drop in Sidma SA'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 |
| Sidma SA vs. Interlife General Insurance | Sidma SA vs. Marfin Investment Group | Sidma SA vs. Karelia Tobacco | Sidma SA vs. Piraeus Financial Holdings |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |