Correlation Between Greek Organization and Admie Holding
Can any of the company-specific risk be diversified away by investing in both Greek Organization and Admie Holding 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 Greek Organization and Admie Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greek Organization of and Admie Holding SA, you can compare the effects of market volatilities on Greek Organization and Admie Holding 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 Greek Organization with a short position of Admie Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greek Organization and Admie Holding.
Diversification Opportunities for Greek Organization and Admie Holding
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Greek and Admie is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Greek Organization of and Admie Holding SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Admie Holding SA and Greek Organization 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 Greek Organization of are associated (or correlated) with Admie Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Admie Holding SA has no effect on the direction of Greek Organization i.e., Greek Organization and Admie Holding go up and down completely randomly.
Pair Corralation between Greek Organization and Admie Holding
Assuming the 90 days trading horizon Greek Organization is expected to generate 1.61 times less return on investment than Admie Holding. But when comparing it to its historical volatility, Greek Organization of is 1.11 times less risky than Admie Holding. It trades about 0.11 of its potential returns per unit of risk. Admie Holding SA is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 266.00 in Admie Holding SA on November 28, 2024 and sell it today you would earn a total of 14.00 from holding Admie Holding SA or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Greek Organization of vs. Admie Holding SA
Performance |
| Timeline |
| Greek Organization |
| Admie Holding SA |
Greek Organization and Admie Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greek Organization and Admie Holding
The main advantage of trading using opposite Greek Organization and Admie Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greek Organization position performs unexpectedly, Admie Holding 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 Admie Holding will offset losses from the drop in Admie Holding's long position.| Greek Organization vs. Mytilineos SA | Greek Organization vs. Hellenic Telecommunications Organization | Greek Organization vs. Motor Oil Corinth | Greek Organization vs. Alpha Services and |
| Admie Holding vs. Public Power | Admie Holding vs. Mytilineos SA | Admie Holding vs. Hellenic Petroleum SA | Admie Holding vs. Greek Organization of |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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