Correlation Between Mytilineos and Greek Organization

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

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

Diversification Opportunities for Mytilineos and Greek Organization

-0.46

Correlation Coefficient

Mytilineos  Greek Organization

Very good diversification

The 3 months correlation between Mytilineos and Greek is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Mytilineos SA and Greek Organization of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greek Organization and Mytilineos 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 Mytilineos SA 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 Mytilineos i.e., Mytilineos and Greek Organization go up and down completely randomly.

Pair Corralation between Mytilineos and Greek Organization

Assuming the 90 days trading horizon Mytilineos SA is expected to under-perform the Greek Organization. But the stock apears to be less risky and, when comparing its historical volatility, Mytilineos SA is 1.03 times less risky than Greek Organization. The stock trades about -0.14 of its potential returns per unit of risk. The Greek Organization of is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest  1,542  in Greek Organization of on March 12, 2024 and sell it today you would lose (52.00) from holding Greek Organization of or give up 3.37% of portfolio value over 90 days.

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

Mytilineos SA  vs.  Greek Organization of

Mytilineos SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mytilineos SA are ranked lower than 4 (%) 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 newest stock price disturbance, may contribute to short-term losses for the 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 latest weak 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.

Pair Trading with Mytilineos and Greek Organization

The main advantage of trading using opposite Mytilineos and Greek Organization positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mytilineos 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 Mytilineos SA 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.