Correlation Between Telenor ASA and Hellenic Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Telenor ASA and Hellenic Telecommunicatio 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 Telenor ASA and Hellenic Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telenor ASA ADR and Hellenic Telecommunications Org, you can compare the effects of market volatilities on Telenor ASA and Hellenic Telecommunicatio 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 Telenor ASA with a short position of Hellenic Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telenor ASA and Hellenic Telecommunicatio.
Diversification Opportunities for Telenor ASA and Hellenic Telecommunicatio
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Telenor and Hellenic is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Telenor ASA ADR and Hellenic Telecommunications Or in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hellenic Telecommunicatio and Telenor ASA 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 Telenor ASA ADR are associated (or correlated) with Hellenic Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hellenic Telecommunicatio has no effect on the direction of Telenor ASA i.e., Telenor ASA and Hellenic Telecommunicatio go up and down completely randomly.
Pair Corralation between Telenor ASA and Hellenic Telecommunicatio
Assuming the 90 days horizon Telenor ASA is expected to generate 2.63 times less return on investment than Hellenic Telecommunicatio. But when comparing it to its historical volatility, Telenor ASA ADR is 2.2 times less risky than Hellenic Telecommunicatio. It trades about 0.04 of its potential returns per unit of risk. Hellenic Telecommunications Org is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 648.00 in Hellenic Telecommunications Org on August 25, 2024 and sell it today you would earn a total of 158.00 from holding Hellenic Telecommunications Org or generate 24.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telenor ASA ADR vs. Hellenic Telecommunications Or
Performance |
| Timeline |
| Telenor ASA ADR |
| Hellenic Telecommunicatio |
Telenor ASA and Hellenic Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telenor ASA and Hellenic Telecommunicatio
The main advantage of trading using opposite Telenor ASA and Hellenic Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telenor ASA position performs unexpectedly, Hellenic Telecommunicatio 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 Hellenic Telecommunicatio will offset losses from the drop in Hellenic Telecommunicatio's long position.| Telenor ASA vs. HUMANA INC | Telenor ASA vs. SCOR PK | Telenor ASA vs. Aquagold International | Telenor ASA vs. Barloworld Ltd ADR |
| Hellenic Telecommunicatio vs. PCCW Limited | Hellenic Telecommunicatio vs. Telenor ASA ADR | Hellenic Telecommunicatio vs. Orange SA ADR | Hellenic Telecommunicatio vs. Telefonica SA ADR |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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