Correlation Between Cenergy Holdings and Hellenic Telecommunicatio

Can any of the company-specific risk be diversified away by investing in both Cenergy Holdings 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 Cenergy Holdings and Hellenic Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Cenergy Holdings and Hellenic Telecommunicatio

0.38

Correlation Coefficient

Cenergy Holdings  Hellenic Telecommunicatio

Weak diversification

The 3 months correlation between Cenergy and Hellenic is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Cenergy Holdings SA and Hellenic Telecommunications Or in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hellenic Telecommunicatio and Cenergy Holdings 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 Cenergy Holdings SA 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 Cenergy Holdings i.e., Cenergy Holdings and Hellenic Telecommunicatio go up and down completely randomly.

Pair Corralation between Cenergy Holdings and Hellenic Telecommunicatio

Assuming the 90 days trading horizon Cenergy Holdings SA is expected to under-perform the Hellenic Telecommunicatio. In addition to that, Cenergy Holdings is 1.33 times more volatile than Hellenic Telecommunications Organization. It trades about -0.02 of its total potential returns per unit of risk. Hellenic Telecommunications Organization is currently generating about -0.01 per unit of volatility. If you would invest  1,504  in Hellenic Telecommunications Organization on September 15, 2024 and sell it today you would lose (21.00) from holding Hellenic Telecommunications Organization or give up 1.4% of portfolio value over 90 days.

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

Cenergy Holdings SA  vs.  Hellenic Telecommunications Or

Cenergy Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cenergy Holdings SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Cenergy Holdings is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Hellenic Telecommunicatio

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hellenic Telecommunications Organization has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Hellenic Telecommunicatio is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Cenergy Holdings and Hellenic Telecommunicatio

The main advantage of trading using opposite Cenergy Holdings and Hellenic Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cenergy Holdings 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.

The idea behind Cenergy Holdings SA and Hellenic Telecommunications Organization 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.