Correlation Between Thrace Plastics and Logismos Information

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

By analyzing existing cross correlation between Thrace Plastics Holding and Logismos Information Systems, you can compare the effects of market volatilities on Thrace Plastics and Logismos Information 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 Thrace Plastics with a short position of Logismos Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrace Plastics and Logismos Information.

Diversification Opportunities for Thrace Plastics and Logismos Information

-0.16

Correlation Coefficient

Thrace Plastics  Logismos Information

Good diversification

The 3 months correlation between Thrace and Logismos is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Thrace Plastics Holding and Logismos Information Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logismos Information and Thrace Plastics 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 Thrace Plastics Holding are associated (or correlated) with Logismos Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logismos Information has no effect on the direction of Thrace Plastics i.e., Thrace Plastics and Logismos Information go up and down completely randomly.

Pair Corralation between Thrace Plastics and Logismos Information

Assuming the 90 days trading horizon Thrace Plastics Holding is expected to generate 1.01 times more return on investment than Logismos Information. However, Thrace Plastics is 1.01 times more volatile than Logismos Information Systems. It trades about 0.07 of its potential returns per unit of risk. Logismos Information Systems is currently generating about 0.06 per unit of risk. If you would invest  393.00  in Thrace Plastics Holding on December 24, 2024 and sell it today you would earn a total of  24.00  from holding Thrace Plastics Holding or generate 6.11% return on investment over 90 days.

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

Thrace Plastics Holding  vs.  Logismos Information Systems

Thrace Plastics Holding

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Thrace Plastics Holding are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Thrace Plastics may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Logismos Information

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Logismos Information Systems are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Logismos Information is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Thrace Plastics and Logismos Information

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

The idea behind Thrace Plastics Holding and Logismos Information Systems 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.