Correlation Between LAMDA Development and Thessaloniki Water
Can any of the company-specific risk be diversified away by investing in both LAMDA Development and Thessaloniki Water 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 LAMDA Development and Thessaloniki Water into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LAMDA Development SA and Thessaloniki Water Supply, you can compare the effects of market volatilities on LAMDA Development and Thessaloniki Water 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 LAMDA Development with a short position of Thessaloniki Water. Check out your portfolio center. Please also check ongoing floating volatility patterns of LAMDA Development and Thessaloniki Water.
Diversification Opportunities for LAMDA Development and Thessaloniki Water
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between LAMDA and Thessaloniki is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding LAMDA Development SA and Thessaloniki Water Supply in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thessaloniki Water Supply and LAMDA Development 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 LAMDA Development SA are associated (or correlated) with Thessaloniki Water. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thessaloniki Water Supply has no effect on the direction of LAMDA Development i.e., LAMDA Development and Thessaloniki Water go up and down completely randomly.
Pair Corralation between LAMDA Development and Thessaloniki Water
Assuming the 90 days trading horizon LAMDA Development SA is expected to under-perform the Thessaloniki Water. In addition to that, LAMDA Development is 1.15 times more volatile than Thessaloniki Water Supply. It trades about 0.0 of its total potential returns per unit of risk. Thessaloniki Water Supply is currently generating about 0.02 per unit of volatility. If you would invest 325.00 in Thessaloniki Water Supply on November 3, 2024 and sell it today you would earn a total of 13.00 from holding Thessaloniki Water Supply or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LAMDA Development SA vs. Thessaloniki Water Supply
Performance |
| Timeline |
| LAMDA Development |
| Thessaloniki Water Supply |
LAMDA Development and Thessaloniki Water Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LAMDA Development and Thessaloniki Water
The main advantage of trading using opposite LAMDA Development and Thessaloniki Water positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LAMDA Development position performs unexpectedly, Thessaloniki Water 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 Thessaloniki Water will offset losses from the drop in Thessaloniki Water's long position.| LAMDA Development vs. Hellenic Telecommunications Organization | LAMDA Development vs. Daios Plastics SA | LAMDA Development vs. Sidma SA Steel | LAMDA Development vs. National Bank of |
| Thessaloniki Water vs. Hellenic Petroleum SA | Thessaloniki Water vs. Mytilineos SA | Thessaloniki Water vs. Hellenic Telecommunications Organization | Thessaloniki Water vs. Public Power |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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