Correlation Between Alpha Trust and Marfin Investment

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

By analyzing existing cross correlation between Alpha Trust Mutual and Marfin Investment Group, you can compare the effects of market volatilities on Alpha Trust and Marfin Investment 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 Trust with a short position of Marfin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Trust and Marfin Investment.

Diversification Opportunities for Alpha Trust and Marfin Investment

-0.46

Correlation Coefficient

Alpha Trust  Marfin Investment

Very good diversification

The 3 months correlation between Alpha and Marfin is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Trust Mutual and Marfin Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marfin Investment and Alpha Trust 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 Trust Mutual are associated (or correlated) with Marfin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marfin Investment has no effect on the direction of Alpha Trust i.e., Alpha Trust and Marfin Investment go up and down completely randomly.

Pair Corralation between Alpha Trust and Marfin Investment

Assuming the 90 days trading horizon Alpha Trust Mutual is expected to generate 0.4 times more return on investment than Marfin Investment. However, Alpha Trust Mutual is 2.52 times less risky than Marfin Investment. It trades about 0.11 of its potential returns per unit of risk. Marfin Investment Group is currently generating about -0.03 per unit of risk. If you would invest  617.00  in Alpha Trust Mutual on September 12, 2024 and sell it today you would earn a total of  257.00  from holding Alpha Trust Mutual or generate 41.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Alpha Trust Mutual  vs.  Marfin Investment Group

Alpha Trust Mutual

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Trust Mutual are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Alpha Trust is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Marfin Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Marfin Investment Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Alpha Trust and Marfin Investment

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

The idea behind Alpha Trust Mutual and Marfin Investment Group 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.

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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.