Correlation Between Viohalco and Cenergy Holdings
Can any of the company-specific risk be diversified away by investing in both Viohalco and Cenergy Holdings 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 Viohalco and Cenergy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viohalco SA and Cenergy Holdings SA, you can compare the effects of market volatilities on Viohalco and Cenergy Holdings 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 Viohalco with a short position of Cenergy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viohalco and Cenergy Holdings.
Diversification Opportunities for Viohalco and Cenergy Holdings
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Viohalco and Cenergy is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Viohalco SA and Cenergy Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cenergy Holdings and Viohalco 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 Viohalco SA are associated (or correlated) with Cenergy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cenergy Holdings has no effect on the direction of Viohalco i.e., Viohalco and Cenergy Holdings go up and down completely randomly.
Pair Corralation between Viohalco and Cenergy Holdings
Assuming the 90 days trading horizon Viohalco SA is expected to generate 0.87 times more return on investment than Cenergy Holdings. However, Viohalco SA is 1.16 times less risky than Cenergy Holdings. It trades about -0.01 of its potential returns per unit of risk. Cenergy Holdings SA is currently generating about -0.03 per unit of risk. If you would invest 555.00 in Viohalco SA on September 14, 2024 and sell it today you would lose (8.00) from holding Viohalco SA or give up 1.44% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Viohalco SA vs. Cenergy Holdings SA
Performance |
Timeline |
Viohalco SA |
Cenergy Holdings |
Viohalco and Cenergy Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Viohalco and Cenergy Holdings
The main advantage of trading using opposite Viohalco and Cenergy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viohalco position performs unexpectedly, Cenergy Holdings 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 Cenergy Holdings will offset losses from the drop in Cenergy Holdings' long position.Viohalco vs. Eurobank Ergasias Services | Viohalco vs. Interlife General Insurance | Viohalco vs. Intertech SA Inter | Viohalco vs. Thrace Plastics Holding |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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