Correlation Between EL D and Autohellas

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

By analyzing existing cross correlation between EL D Mouzakis and Autohellas SA, you can compare the effects of market volatilities on EL D and Autohellas 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 EL D with a short position of Autohellas. Check out your portfolio center. Please also check ongoing floating volatility patterns of EL D and Autohellas.

Diversification Opportunities for EL D and Autohellas

0.49

Correlation Coefficient

EL D  Autohellas

Very weak diversification

The 3 months correlation between MOYZK and Autohellas is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding EL D Mouzakis and Autohellas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohellas SA and EL D 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 EL D Mouzakis are associated (or correlated) with Autohellas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohellas SA has no effect on the direction of EL D i.e., EL D and Autohellas go up and down completely randomly.

Pair Corralation between EL D and Autohellas

Assuming the 90 days trading horizon EL D Mouzakis is expected to under-perform the Autohellas. In addition to that, EL D is 1.67 times more volatile than Autohellas SA. It trades about 0.0 of its total potential returns per unit of risk. Autohellas SA is currently generating about 0.02 per unit of volatility. If you would invest  1,048  in Autohellas SA on December 2, 2024 and sell it today you would earn a total of  14.00  from holding Autohellas SA or generate 1.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

EL D Mouzakis  vs.  Autohellas SA

EL D Mouzakis

Risk-Adjusted Performance

Very Weak

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

Autohellas SA

Risk-Adjusted Performance

Weak

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

Pair Trading with EL D and Autohellas

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

The idea behind EL D Mouzakis and Autohellas SA 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.