Correlation Between Lanakam SA and EL D
Can any of the company-specific risk be diversified away by investing in both Lanakam SA and EL D 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 Lanakam SA and EL D into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lanakam SA and EL D Mouzakis, you can compare the effects of market volatilities on Lanakam SA and EL D 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 Lanakam SA with a short position of EL D. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lanakam SA and EL D.
Diversification Opportunities for Lanakam SA and EL D
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lanakam and MOYZK is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Lanakam SA and EL D Mouzakis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EL D Mouzakis and Lanakam SA 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 Lanakam SA are associated (or correlated) with EL D. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EL D Mouzakis has no effect on the direction of Lanakam SA i.e., Lanakam SA and EL D go up and down completely randomly.
Pair Corralation between Lanakam SA and EL D
Assuming the 90 days trading horizon Lanakam SA is expected to under-perform the EL D. In addition to that, Lanakam SA is 1.35 times more volatile than EL D Mouzakis. It trades about -0.71 of its total potential returns per unit of risk. EL D Mouzakis is currently generating about -0.13 per unit of volatility. If you would invest 67.00 in EL D Mouzakis on November 9, 2024 and sell it today you would lose (2.00) from holding EL D Mouzakis or give up 2.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 20.0% |
| Values | Daily Returns |
Lanakam SA vs. EL D Mouzakis
Performance |
| Timeline |
| Lanakam SA |
Risk-Adjusted Performance
Solid
Weak | Strong |
| EL D Mouzakis |
Risk-Adjusted Performance
Weak
Weak | Strong |
Lanakam SA and EL D Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lanakam SA and EL D
The main advantage of trading using opposite Lanakam SA and EL D positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lanakam SA position performs unexpectedly, EL D 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 EL D will offset losses from the drop in EL D's long position.| Lanakam SA vs. General Commercial Industrial | Lanakam SA vs. Profile Systems Software | Lanakam SA vs. Hellenic Telecommunications Organization | Lanakam SA vs. Eurobank Ergasias Services |
| EL D vs. Karelia Tobacco | EL D vs. Daios Plastics SA | EL D vs. Thrace Plastics Holding | EL D vs. Intracom Constructions Societe |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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