Correlation Between Alpha Bank and Piraeus Financial

Can any of the company-specific risk be diversified away by investing in both Alpha Bank and Piraeus Financial 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 Alpha Bank and Piraeus Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alpha Bank SA and Piraeus Financial Holdings, you can compare the effects of market volatilities on Alpha Bank and Piraeus Financial 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 Alpha Bank with a short position of Piraeus Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Bank and Piraeus Financial.

Diversification Opportunities for Alpha Bank and Piraeus Financial

0.0

Correlation Coefficient

Alpha Bank  Piraeus Financial

Pay attention - limited upside

The 3 months correlation between Alpha and Piraeus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Bank SA and Piraeus Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Piraeus Financial and Alpha Bank 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 Alpha Bank SA are associated (or correlated) with Piraeus Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Piraeus Financial has no effect on the direction of Alpha Bank i.e., Alpha Bank and Piraeus Financial go up and down completely randomly.

Pair Corralation between Alpha Bank and Piraeus Financial

If you would invest  38.00  in Alpha Bank SA on December 29, 2024 and sell it today you would earn a total of  28.00  from holding Alpha Bank SA or generate 73.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Alpha Bank SA  vs.  Piraeus Financial Holdings

Alpha Bank SA

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Bank SA are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile forward-looking signals, Alpha Bank showed solid returns over the last few months and may actually be approaching a breakup point.

Piraeus Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Piraeus Financial Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Piraeus Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Alpha Bank and Piraeus Financial

The main advantage of trading using opposite Alpha Bank and Piraeus Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha Bank position performs unexpectedly, Piraeus Financial 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 Piraeus Financial will offset losses from the drop in Piraeus Financial's long position.

The idea behind Alpha Bank SA and Piraeus Financial Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.