Correlation Between Piraeus Financial and Kiriacoulis Mediterranean

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

By analyzing existing cross correlation between Piraeus Financial Holdings and Kiriacoulis Mediterranean Cruises, you can compare the effects of market volatilities on Piraeus Financial and Kiriacoulis Mediterranean 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 Piraeus Financial with a short position of Kiriacoulis Mediterranean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piraeus Financial and Kiriacoulis Mediterranean.

Diversification Opportunities for Piraeus Financial and Kiriacoulis Mediterranean

0.73

Correlation Coefficient

Piraeus Financial  Kiriacoulis Mediterranean

Poor diversification

The 3 months correlation between Piraeus and Kiriacoulis is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Piraeus Financial Holdings and Kiriacoulis Mediterranean Crui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiriacoulis Mediterranean and Piraeus Financial 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 Piraeus Financial Holdings are associated (or correlated) with Kiriacoulis Mediterranean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiriacoulis Mediterranean has no effect on the direction of Piraeus Financial i.e., Piraeus Financial and Kiriacoulis Mediterranean go up and down completely randomly.

Pair Corralation between Piraeus Financial and Kiriacoulis Mediterranean

Assuming the 90 days trading horizon Piraeus Financial Holdings is expected to generate 0.83 times more return on investment than Kiriacoulis Mediterranean. However, Piraeus Financial Holdings is 1.2 times less risky than Kiriacoulis Mediterranean. It trades about 0.43 of its potential returns per unit of risk. Kiriacoulis Mediterranean Cruises is currently generating about 0.01 per unit of risk. If you would invest  385.00  in Piraeus Financial Holdings on October 26, 2024 and sell it today you would earn a total of  46.00  from holding Piraeus Financial Holdings or generate 11.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	94.74%
Values	Daily Returns

Piraeus Financial Holdings  vs.  Kiriacoulis Mediterranean Crui

Piraeus Financial

Risk-Adjusted Performance

17 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Piraeus Financial Holdings are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Piraeus Financial sustained solid returns over the last few months and may actually be approaching a breakup point.

Kiriacoulis Mediterranean

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kiriacoulis Mediterranean Cruises are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Kiriacoulis Mediterranean 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 Piraeus Financial and Kiriacoulis Mediterranean

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

The idea behind Piraeus Financial Holdings and Kiriacoulis Mediterranean Cruises 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.

Check out your portfolio center.

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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.