Correlation Between Greek Organization and National Bank
Can any of the company-specific risk be diversified away by investing in both Greek Organization and National Bank 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 National Bank 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 National Bank of, you can compare the effects of market volatilities on Greek Organization and National Bank 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 National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greek Organization and National Bank.
Diversification Opportunities for Greek Organization and National Bank
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Greek and National is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Greek Organization of and National Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank 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 National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank has no effect on the direction of Greek Organization i.e., Greek Organization and National Bank go up and down completely randomly.
Pair Corralation between Greek Organization and National Bank
Assuming the 90 days trading horizon Greek Organization of is expected to generate 0.47 times more return on investment than National Bank. However, Greek Organization of is 2.13 times less risky than National Bank. It trades about 0.06 of its potential returns per unit of risk. National Bank of is currently generating about -0.09 per unit of risk. If you would invest 1,515 in Greek Organization of on August 24, 2024 and sell it today you would earn a total of 15.00 from holding Greek Organization of or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greek Organization of vs. National Bank of
Performance |
| Timeline |
| Greek Organization |
| National Bank |
Greek Organization and National Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greek Organization and National Bank
The main advantage of trading using opposite Greek Organization and National Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greek Organization position performs unexpectedly, National Bank 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 National Bank will offset losses from the drop in National Bank'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 |
| National Bank vs. Alpha Services and | National Bank vs. Eurobank Ergasias Services | National Bank vs. Piraeus Financial Holdings | National Bank 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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