Correlation Between Lampsa Hellenic and Alpha Services

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

By analyzing existing cross correlation between Lampsa Hellenic Hotels and Alpha Services and, you can compare the effects of market volatilities on Lampsa Hellenic and Alpha Services 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 Lampsa Hellenic with a short position of Alpha Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lampsa Hellenic and Alpha Services.

Diversification Opportunities for Lampsa Hellenic and Alpha Services

0.12

Correlation Coefficient

Lampsa Hellenic  Alpha Services

Average diversification

The 3 months correlation between Lampsa and Alpha is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Lampsa Hellenic Hotels and Alpha Services and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha Services and Lampsa Hellenic 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 Lampsa Hellenic Hotels are associated (or correlated) with Alpha Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha Services has no effect on the direction of Lampsa Hellenic i.e., Lampsa Hellenic and Alpha Services go up and down completely randomly.

Pair Corralation between Lampsa Hellenic and Alpha Services

Assuming the 90 days trading horizon Lampsa Hellenic Hotels is expected to generate 0.5 times more return on investment than Alpha Services. However, Lampsa Hellenic Hotels is 2.02 times less risky than Alpha Services. It trades about 0.02 of its potential returns per unit of risk. Alpha Services and is currently generating about 0.0 per unit of risk. If you would invest  3,700  in Lampsa Hellenic Hotels on September 5, 2024 and sell it today you would earn a total of  40.00  from holding Lampsa Hellenic Hotels or generate 1.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Lampsa Hellenic Hotels  vs.  Alpha Services and

Lampsa Hellenic Hotels

Risk-Adjusted Performance

1 of 100

Weak

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

Alpha Services

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Lampsa Hellenic and Alpha Services

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

The idea behind Lampsa Hellenic Hotels and Alpha Services and 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.