Correlation Between Hellenic Petroleum and Ekter SA

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

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

Diversification Opportunities for Hellenic Petroleum and Ekter SA

0.55

Correlation Coefficient

Hellenic Petroleum  Ekter SA

Very weak diversification

The 3 months correlation between Hellenic and Ekter is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hellenic Petroleum SA and Ekter SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekter SA and Hellenic Petroleum 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 Hellenic Petroleum SA are associated (or correlated) with Ekter SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekter SA has no effect on the direction of Hellenic Petroleum i.e., Hellenic Petroleum and Ekter SA go up and down completely randomly.

Pair Corralation between Hellenic Petroleum and Ekter SA

Assuming the 90 days trading horizon Hellenic Petroleum SA is expected to generate 0.4 times more return on investment than Ekter SA. However, Hellenic Petroleum SA is 2.51 times less risky than Ekter SA. It trades about 0.03 of its potential returns per unit of risk. Ekter SA is currently generating about -0.04 per unit of risk. If you would invest  705.00  in Hellenic Petroleum SA on September 15, 2024 and sell it today you would earn a total of  13.00  from holding Hellenic Petroleum SA or generate 1.84% return on investment over 90 days.

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

Hellenic Petroleum SA  vs.  Ekter SA

Hellenic Petroleum

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hellenic Petroleum SA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Hellenic Petroleum is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Ekter SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ekter SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Hellenic Petroleum and Ekter SA

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

The idea behind Hellenic Petroleum SA and Ekter 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.