Correlation Between Autohellas and Profile Systems
Can any of the company-specific risk be diversified away by investing in both Autohellas and Profile 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 Autohellas and Profile Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autohellas SA and Profile Systems Software, you can compare the effects of market volatilities on Autohellas and Profile 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 Autohellas with a short position of Profile Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autohellas and Profile Systems.
Diversification Opportunities for Autohellas and Profile Systems
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Autohellas and Profile is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Autohellas SA and Profile Systems Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profile Systems Software and Autohellas 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 Autohellas SA are associated (or correlated) with Profile Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profile Systems Software has no effect on the direction of Autohellas i.e., Autohellas and Profile Systems go up and down completely randomly.
Pair Corralation between Autohellas and Profile Systems
Assuming the 90 days trading horizon Autohellas SA is expected to under-perform the Profile Systems. But the stock apears to be less risky and, when comparing its historical volatility, Autohellas SA is 1.05 times less risky than Profile Systems. The stock trades about -0.02 of its potential returns per unit of risk. The Profile Systems Software is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 500.00 in Profile Systems Software on October 26, 2024 and sell it today you would earn a total of 40.00 from holding Profile Systems Software or generate 8.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autohellas SA vs. Profile Systems Software
Performance |
| Timeline |
| Autohellas SA |
| Profile Systems Software |
Autohellas and Profile Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autohellas and Profile Systems
The main advantage of trading using opposite Autohellas and Profile Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autohellas position performs unexpectedly, Profile 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 Profile Systems will offset losses from the drop in Profile Systems' long position.| Autohellas vs. National Bank of | Autohellas vs. N Leventeris SA | Autohellas vs. Eurobank Ergasias Services | Autohellas vs. Vogiatzoglou Systems SA |
| Profile Systems vs. Terna Energy Societe | Profile Systems vs. Mytilineos SA | Profile Systems vs. Public Power | Profile Systems vs. Autohellas SA |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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