Correlation Between Piraeus Financial and Technical Olympic
Can any of the company-specific risk be diversified away by investing in both Piraeus Financial and Technical Olympic 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 Technical Olympic 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 Technical Olympic SA, you can compare the effects of market volatilities on Piraeus Financial and Technical Olympic 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 Technical Olympic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piraeus Financial and Technical Olympic.
Diversification Opportunities for Piraeus Financial and Technical Olympic
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Piraeus and Technical is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Piraeus Financial Holdings and Technical Olympic SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Technical Olympic 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 Technical Olympic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Technical Olympic has no effect on the direction of Piraeus Financial i.e., Piraeus Financial and Technical Olympic go up and down completely randomly.
Pair Corralation between Piraeus Financial and Technical Olympic
Assuming the 90 days trading horizon Piraeus Financial Holdings is expected to generate 1.14 times more return on investment than Technical Olympic. However, Piraeus Financial is 1.14 times more volatile than Technical Olympic SA. It trades about 0.04 of its potential returns per unit of risk. Technical Olympic SA is currently generating about 0.01 per unit of risk. If you would invest 283.00 in Piraeus Financial Holdings on August 27, 2024 and sell it today you would earn a total of 76.00 from holding Piraeus Financial Holdings or generate 26.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Piraeus Financial Holdings vs. Technical Olympic SA
Performance |
| Timeline |
| Piraeus Financial |
| Technical Olympic |
Piraeus Financial and Technical Olympic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Piraeus Financial and Technical Olympic
The main advantage of trading using opposite Piraeus Financial and Technical Olympic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Piraeus Financial position performs unexpectedly, Technical Olympic 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 Technical Olympic will offset losses from the drop in Technical Olympic's long position.| Piraeus Financial vs. Alpha Services and | Piraeus Financial vs. EL D Mouzakis | Piraeus Financial vs. Lampsa Hellenic Hotels | Piraeus Financial vs. Eurobank Ergasias Services |
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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