Correlation Between IKloukinas ILappas and Athens Medical

Can any of the company-specific risk be diversified away by investing in both IKloukinas ILappas and Athens Medical 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 IKloukinas ILappas and Athens Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between IKloukinas ILappas SA and Athens Medical CSA, you can compare the effects of market volatilities on IKloukinas ILappas and Athens Medical 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 IKloukinas ILappas with a short position of Athens Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of IKloukinas ILappas and Athens Medical.

Diversification Opportunities for IKloukinas ILappas and Athens Medical

-0.39

Correlation Coefficient

IKloukinas ILappas  Athens Medical

Very good diversification

The 3 months correlation between IKloukinas and Athens is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding IKloukinas ILappas SA and Athens Medical CSA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athens Medical CSA and IKloukinas ILappas 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 IKloukinas ILappas SA are associated (or correlated) with Athens Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athens Medical CSA has no effect on the direction of IKloukinas ILappas i.e., IKloukinas ILappas and Athens Medical go up and down completely randomly.

Pair Corralation between IKloukinas ILappas and Athens Medical

Assuming the 90 days trading horizon IKloukinas ILappas SA is expected to generate 1.15 times more return on investment than Athens Medical. However, IKloukinas ILappas is 1.15 times more volatile than Athens Medical CSA. It trades about 0.09 of its potential returns per unit of risk. Athens Medical CSA is currently generating about 0.01 per unit of risk. If you would invest  62.00  in IKloukinas ILappas SA on October 12, 2024 and sell it today you would earn a total of  85.00  from holding IKloukinas ILappas SA or generate 137.1% return on investment over 90 days.

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

IKloukinas ILappas SA  vs.  Athens Medical CSA

IKloukinas ILappas

Risk-Adjusted Performance

0 of 100

Very Weak

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

Athens Medical CSA

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Athens Medical CSA are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Athens Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IKloukinas ILappas and Athens Medical

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

The idea behind IKloukinas ILappas SA and Athens Medical CSA 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.