Correlation Between Hellenic Telecommunicatio and Prodea Real

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

By analyzing existing cross correlation between Hellenic Telecommunications Organization and Prodea Real Estate, you can compare the effects of market volatilities on Hellenic Telecommunicatio and Prodea Real 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 Telecommunicatio with a short position of Prodea Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hellenic Telecommunicatio and Prodea Real.

Diversification Opportunities for Hellenic Telecommunicatio and Prodea Real

0.04

Correlation Coefficient

Hellenic Telecommunicatio  Prodea Real

Significant diversification

The 3 months correlation between Hellenic and Prodea is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Hellenic Telecommunications Or and Prodea Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodea Real Estate and Hellenic Telecommunicatio 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 Telecommunications Organization are associated (or correlated) with Prodea Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodea Real Estate has no effect on the direction of Hellenic Telecommunicatio i.e., Hellenic Telecommunicatio and Prodea Real go up and down completely randomly.

Pair Corralation between Hellenic Telecommunicatio and Prodea Real

Assuming the 90 days trading horizon Hellenic Telecommunications Organization is expected to under-perform the Prodea Real. But the stock apears to be less risky and, when comparing its historical volatility, Hellenic Telecommunications Organization is 3.19 times less risky than Prodea Real. The stock trades about 0.0 of its potential returns per unit of risk. The Prodea Real Estate is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  666.00  in Prodea Real Estate on September 13, 2024 and sell it today you would earn a total of  24.00  from holding Prodea Real Estate or generate 3.6% return on investment over 90 days.

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

Hellenic Telecommunications Or  vs.  Prodea Real Estate

Hellenic Telecommunicatio

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hellenic Telecommunications Organization has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Hellenic Telecommunicatio is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Prodea Real Estate

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Prodea Real Estate are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Prodea Real may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Hellenic Telecommunicatio and Prodea Real

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

The idea behind Hellenic Telecommunications Organization and Prodea Real Estate 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.