Correlation Between Thrace Plastics and Optima Bank
Can any of the company-specific risk be diversified away by investing in both Thrace Plastics and Optima 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 Thrace Plastics and Optima Bank 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 Optima bank SA, you can compare the effects of market volatilities on Thrace Plastics and Optima 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 Thrace Plastics with a short position of Optima Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrace Plastics and Optima Bank.
Diversification Opportunities for Thrace Plastics and Optima Bank
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thrace and Optima is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Thrace Plastics Holding and Optima bank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optima bank SA 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 Optima Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optima bank SA has no effect on the direction of Thrace Plastics i.e., Thrace Plastics and Optima Bank go up and down completely randomly.
Pair Corralation between Thrace Plastics and Optima Bank
Assuming the 90 days trading horizon Thrace Plastics Holding is expected to under-perform the Optima Bank. But the stock apears to be less risky and, when comparing its historical volatility, Thrace Plastics Holding is 1.29 times less risky than Optima Bank. The stock trades about -0.03 of its potential returns per unit of risk. The Optima bank SA is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 709.00 in Optima bank SA on August 28, 2024 and sell it today you would earn a total of 593.00 from holding Optima bank SA or generate 83.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thrace Plastics Holding vs. Optima bank SA
Performance |
| Timeline |
| Thrace Plastics Holding |
| Optima bank SA |
Thrace Plastics and Optima Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrace Plastics and Optima Bank
The main advantage of trading using opposite Thrace Plastics and Optima Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrace Plastics position performs unexpectedly, Optima 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 Optima Bank will offset losses from the drop in Optima Bank's long position.| Thrace Plastics vs. Elvalhalcor Hellenic Copper | Thrace Plastics vs. Performance Technologies SA | Thrace Plastics vs. Optronics Technologies SA | Thrace Plastics vs. Logismos Information Systems |
| Optima Bank vs. Interlife General Insurance | Optima Bank vs. Marfin Investment Group | Optima Bank vs. Hellenic Telecommunications Organization | Optima Bank vs. Foodlink AE |
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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