Correlation Between Greek Organization and Mytilineos

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

By analyzing existing cross correlation between Greek Organization of and Mytilineos SA, you can compare the effects of market volatilities on Greek Organization and Mytilineos 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 Greek Organization with a short position of Mytilineos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greek Organization and Mytilineos.

Diversification Opportunities for Greek Organization and Mytilineos

-0.34

Correlation Coefficient

Greek Organization  Mytilineos

Very good diversification

The 3 months correlation between Greek and Mytilineos is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Greek Organization of and Mytilineos SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mytilineos SA and Greek Organization 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 Greek Organization of are associated (or correlated) with Mytilineos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mytilineos SA has no effect on the direction of Greek Organization i.e., Greek Organization and Mytilineos go up and down completely randomly.

Pair Corralation between Greek Organization and Mytilineos

Assuming the 90 days trading horizon Greek Organization of is expected to under-perform the Mytilineos. But the stock apears to be less risky and, when comparing its historical volatility, Greek Organization of is 1.24 times less risky than Mytilineos. The stock trades about -0.28 of its potential returns per unit of risk. The Mytilineos SA is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest  3,562  in Mytilineos SA on February 11, 2024 and sell it today you would earn a total of  340.00  from holding Mytilineos SA or generate 9.55% return on investment over 90 days.

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

Greek Organization of  vs.  Mytilineos SA

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 latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Mytilineos SA

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mytilineos SA are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong essential indicators, Mytilineos is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Greek Organization and Mytilineos

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

The idea behind Greek Organization of and Mytilineos SA 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.