Correlation Between Thrace Plastics and Mermeren Kombinat
Can any of the company-specific risk be diversified away by investing in both Thrace Plastics and Mermeren Kombinat 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 Thrace Plastics and Mermeren Kombinat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thrace Plastics Holding and Mermeren Kombinat AD, you can compare the effects of market volatilities on Thrace Plastics and Mermeren Kombinat 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 Thrace Plastics with a short position of Mermeren Kombinat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrace Plastics and Mermeren Kombinat.
Diversification Opportunities for Thrace Plastics and Mermeren Kombinat
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Thrace and Mermeren is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Thrace Plastics Holding and Mermeren Kombinat AD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mermeren Kombinat and Thrace Plastics 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 Thrace Plastics Holding are associated (or correlated) with Mermeren Kombinat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mermeren Kombinat has no effect on the direction of Thrace Plastics i.e., Thrace Plastics and Mermeren Kombinat go up and down completely randomly.
Pair Corralation between Thrace Plastics and Mermeren Kombinat
Assuming the 90 days trading horizon Thrace Plastics Holding is expected to generate 0.43 times more return on investment than Mermeren Kombinat. However, Thrace Plastics Holding is 2.34 times less risky than Mermeren Kombinat. It trades about -0.01 of its potential returns per unit of risk. Mermeren Kombinat AD is currently generating about -0.01 per unit of risk. If you would invest 429.00 in Thrace Plastics Holding on November 3, 2024 and sell it today you would lose (22.00) from holding Thrace Plastics Holding or give up 5.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Thrace Plastics Holding vs. Mermeren Kombinat AD
Performance |
| Timeline |
| Thrace Plastics Holding |
| Mermeren Kombinat |
Thrace Plastics and Mermeren Kombinat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrace Plastics and Mermeren Kombinat
The main advantage of trading using opposite Thrace Plastics and Mermeren Kombinat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrace Plastics position performs unexpectedly, Mermeren Kombinat 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 Mermeren Kombinat will offset losses from the drop in Mermeren Kombinat's long position.| Thrace Plastics vs. Marfin Investment Group | Thrace Plastics vs. Piraeus Financial Holdings | Thrace Plastics vs. Lampsa Hellenic Hotels | Thrace Plastics vs. Elvalhalcor Hellenic Copper |
| Mermeren Kombinat vs. Mytilineos SA | Mermeren Kombinat vs. Viohalco SA | Mermeren Kombinat vs. National Bank of | Mermeren Kombinat vs. EL D Mouzakis |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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