Correlation Between Ktima Kostas and Karelia Tobacco
Can any of the company-specific risk be diversified away by investing in both Ktima Kostas and Karelia Tobacco 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 Ktima Kostas and Karelia Tobacco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ktima Kostas Lazaridis and Karelia Tobacco, you can compare the effects of market volatilities on Ktima Kostas and Karelia Tobacco 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 Ktima Kostas with a short position of Karelia Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ktima Kostas and Karelia Tobacco.
Diversification Opportunities for Ktima Kostas and Karelia Tobacco
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ktima and Karelia is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Ktima Kostas Lazaridis and Karelia Tobacco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Karelia Tobacco and Ktima Kostas 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 Ktima Kostas Lazaridis are associated (or correlated) with Karelia Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Karelia Tobacco has no effect on the direction of Ktima Kostas i.e., Ktima Kostas and Karelia Tobacco go up and down completely randomly.
Pair Corralation between Ktima Kostas and Karelia Tobacco
Assuming the 90 days trading horizon Ktima Kostas Lazaridis is expected to generate 1.42 times more return on investment than Karelia Tobacco. However, Ktima Kostas is 1.42 times more volatile than Karelia Tobacco. It trades about 0.01 of its potential returns per unit of risk. Karelia Tobacco is currently generating about 0.01 per unit of risk. If you would invest 174.00 in Ktima Kostas Lazaridis on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Ktima Kostas Lazaridis or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Ktima Kostas Lazaridis vs. Karelia Tobacco
Performance |
| Timeline |
| Ktima Kostas Lazaridis |
| Karelia Tobacco |
Ktima Kostas and Karelia Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ktima Kostas and Karelia Tobacco
The main advantage of trading using opposite Ktima Kostas and Karelia Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ktima Kostas position performs unexpectedly, Karelia Tobacco 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 Karelia Tobacco will offset losses from the drop in Karelia Tobacco's long position.| Ktima Kostas vs. Karelia Tobacco | Ktima Kostas vs. Marfin Investment Group | Ktima Kostas vs. CPI Computer Peripherals | Ktima Kostas vs. Technical Olympic SA |
| Karelia Tobacco vs. Greek Organization of | Karelia Tobacco vs. Jumbo SA | Karelia Tobacco vs. Mytilineos SA | Karelia Tobacco vs. Motor Oil Corinth |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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