Correlation Between Piraeus Financial and Kekrops SA
Can any of the company-specific risk be diversified away by investing in both Piraeus Financial and Kekrops SA 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 Piraeus Financial and Kekrops SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Piraeus Financial Holdings and Kekrops SA, you can compare the effects of market volatilities on Piraeus Financial and Kekrops SA 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 Piraeus Financial with a short position of Kekrops SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piraeus Financial and Kekrops SA.
Diversification Opportunities for Piraeus Financial and Kekrops SA
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Piraeus and Kekrops is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Piraeus Financial Holdings and Kekrops SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kekrops SA and Piraeus Financial 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 Piraeus Financial Holdings are associated (or correlated) with Kekrops SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kekrops SA has no effect on the direction of Piraeus Financial i.e., Piraeus Financial and Kekrops SA go up and down completely randomly.
Pair Corralation between Piraeus Financial and Kekrops SA
Assuming the 90 days trading horizon Piraeus Financial Holdings is expected to generate 0.75 times more return on investment than Kekrops SA. However, Piraeus Financial Holdings is 1.34 times less risky than Kekrops SA. It trades about 0.24 of its potential returns per unit of risk. Kekrops SA is currently generating about 0.07 per unit of risk. If you would invest 382.00 in Piraeus Financial Holdings on November 29, 2024 and sell it today you would earn a total of 73.00 from holding Piraeus Financial Holdings or generate 19.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.62% |
| Values | Daily Returns |
Piraeus Financial Holdings vs. Kekrops SA
Performance |
| Timeline |
| Piraeus Financial |
| Kekrops SA |
Piraeus Financial and Kekrops SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Piraeus Financial and Kekrops SA
The main advantage of trading using opposite Piraeus Financial and Kekrops SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Piraeus Financial position performs unexpectedly, Kekrops SA 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 Kekrops SA will offset losses from the drop in Kekrops SA's long position.| Piraeus Financial vs. Foodlink AE | Piraeus Financial vs. Eurobank Ergasias Services | Piraeus Financial vs. Marfin Investment Group | Piraeus Financial vs. Sidma SA Steel |
| Kekrops SA vs. Alpha Astika Akinita | Kekrops SA vs. Terna Energy Societe | Kekrops SA vs. Intracom Constructions Societe | Kekrops SA vs. Attica Bank 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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