Correlation Between BEL Small and Athens General
Can any of the company-specific risk be diversified away by investing in both BEL Small and Athens General 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 BEL Small and Athens General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BEL Small and Athens General Composite, you can compare the effects of market volatilities on BEL Small and Athens General 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 BEL Small with a short position of Athens General. Check out your portfolio center. Please also check ongoing floating volatility patterns of BEL Small and Athens General.
Diversification Opportunities for BEL Small and Athens General
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between BEL and Athens is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding BEL Small and Athens General Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athens General Composite and BEL Small 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 BEL Small are associated (or correlated) with Athens General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athens General Composite has no effect on the direction of BEL Small i.e., BEL Small and Athens General go up and down completely randomly.
Pair Corralation between BEL Small and Athens General
Assuming the 90 days trading horizon BEL Small is expected to under-perform the Athens General. But the index apears to be less risky and, when comparing its historical volatility, BEL Small is 1.28 times less risky than Athens General. The index trades about -0.19 of its potential returns per unit of risk. The Athens General Composite is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 138,638 in Athens General Composite on February 4, 2024 and sell it today you would earn a total of 6,586 from holding Athens General Composite or generate 4.75% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
BEL Small vs. Athens General Composite
Performance |
Timeline |
BEL Small and Athens General Volatility Contrast
Predicted Return Density |
Returns |
BEL Small
Pair trading matchups for BEL Small
Athens General Composite
Pair trading matchups for Athens General
Pair Trading with BEL Small and Athens General
The main advantage of trading using opposite BEL Small and Athens General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BEL Small position performs unexpectedly, Athens General 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 Athens General will offset losses from the drop in Athens General's long position.BEL Small vs. Immolease Trust NV | BEL Small vs. Shurgard Self Storage | BEL Small vs. Retail Estates | BEL Small vs. Intervest Offices |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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