Correlation Between Piraeus Financial and Greek Organization

Can any of the company-specific risk be diversified away by investing in both Piraeus Financial and Greek Organization 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 Greek Organization 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 Greek Organization of, you can compare the effects of market volatilities on Piraeus Financial and Greek Organization 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 Greek Organization. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piraeus Financial and Greek Organization.

Diversification Opportunities for Piraeus Financial and Greek Organization

0.09

Correlation Coefficient

Piraeus Financial  Greek Organization

Significant diversification

The 3 months correlation between Piraeus and Greek is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Piraeus Financial Holdings and Greek Organization of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greek Organization 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 Greek Organization. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greek Organization has no effect on the direction of Piraeus Financial i.e., Piraeus Financial and Greek Organization go up and down completely randomly.

Pair Corralation between Piraeus Financial and Greek Organization

Assuming the 90 days trading horizon Piraeus Financial Holdings is expected to under-perform the Greek Organization. In addition to that, Piraeus Financial is 1.6 times more volatile than Greek Organization of. It trades about -0.14 of its total potential returns per unit of risk. Greek Organization of is currently generating about 0.0 per unit of volatility. If you would invest  1,553  in Greek Organization of on September 1, 2024 and sell it today you would lose (2.00) from holding Greek Organization of or give up 0.13% of portfolio value over 90 days.

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

Piraeus Financial Holdings  vs.  Greek Organization of

Piraeus Financial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Piraeus Financial Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Greek Organization

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Greek Organization of has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Greek Organization is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Piraeus Financial and Greek Organization

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

The idea behind Piraeus Financial Holdings and Greek Organization of 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.