Correlation Between Marfin Investment and Vogiatzoglou Systems
Can any of the company-specific risk be diversified away by investing in both Marfin Investment and Vogiatzoglou Systems 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 Marfin Investment and Vogiatzoglou Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marfin Investment Group and Vogiatzoglou Systems SA, you can compare the effects of market volatilities on Marfin Investment and Vogiatzoglou Systems 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 Marfin Investment with a short position of Vogiatzoglou Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfin Investment and Vogiatzoglou Systems.
Diversification Opportunities for Marfin Investment and Vogiatzoglou Systems
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Marfin and Vogiatzoglou is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Marfin Investment Group and Vogiatzoglou Systems SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vogiatzoglou Systems and Marfin Investment 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 Marfin Investment Group are associated (or correlated) with Vogiatzoglou Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vogiatzoglou Systems has no effect on the direction of Marfin Investment i.e., Marfin Investment and Vogiatzoglou Systems go up and down completely randomly.
Pair Corralation between Marfin Investment and Vogiatzoglou Systems
Assuming the 90 days trading horizon Marfin Investment Group is expected to under-perform the Vogiatzoglou Systems. But the stock apears to be less risky and, when comparing its historical volatility, Marfin Investment Group is 1.86 times less risky than Vogiatzoglou Systems. The stock trades about -0.07 of its potential returns per unit of risk. The Vogiatzoglou Systems SA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 230.00 in Vogiatzoglou Systems SA on November 5, 2024 and sell it today you would earn a total of 8.00 from holding Vogiatzoglou Systems SA or generate 3.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marfin Investment Group vs. Vogiatzoglou Systems SA
Performance |
| Timeline |
| Marfin Investment |
| Vogiatzoglou Systems |
Marfin Investment and Vogiatzoglou Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marfin Investment and Vogiatzoglou Systems
The main advantage of trading using opposite Marfin Investment and Vogiatzoglou Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfin Investment position performs unexpectedly, Vogiatzoglou Systems 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 Vogiatzoglou Systems will offset losses from the drop in Vogiatzoglou Systems' long position.The idea behind Marfin Investment Group and Vogiatzoglou Systems SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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