Correlation Between Lampsa Hellenic and Kiriacoulis Mediterranean

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

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

Diversification Opportunities for Lampsa Hellenic and Kiriacoulis Mediterranean

0.08

Correlation Coefficient

Lampsa Hellenic  Kiriacoulis Mediterranean

Significant diversification

The 3 months correlation between Lampsa and Kiriacoulis is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Lampsa Hellenic Hotels and Kiriacoulis Mediterranean Crui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiriacoulis Mediterranean and Lampsa Hellenic 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 Lampsa Hellenic Hotels are associated (or correlated) with Kiriacoulis Mediterranean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiriacoulis Mediterranean has no effect on the direction of Lampsa Hellenic i.e., Lampsa Hellenic and Kiriacoulis Mediterranean go up and down completely randomly.

Pair Corralation between Lampsa Hellenic and Kiriacoulis Mediterranean

Assuming the 90 days trading horizon Lampsa Hellenic Hotels is expected to under-perform the Kiriacoulis Mediterranean. But the stock apears to be less risky and, when comparing its historical volatility, Lampsa Hellenic Hotels is 18.64 times less risky than Kiriacoulis Mediterranean. The stock trades about -0.21 of its potential returns per unit of risk. The Kiriacoulis Mediterranean Cruises is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  94.00  in Kiriacoulis Mediterranean Cruises on September 15, 2024 and sell it today you would earn a total of  3.00  from holding Kiriacoulis Mediterranean Cruises or generate 3.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.65%
Values	Daily Returns

Lampsa Hellenic Hotels  vs.  Kiriacoulis Mediterranean Crui

Lampsa Hellenic Hotels

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lampsa Hellenic Hotels are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Lampsa Hellenic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Kiriacoulis Mediterranean

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kiriacoulis Mediterranean Cruises 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.

Pair Trading with Lampsa Hellenic and Kiriacoulis Mediterranean

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

The idea behind Lampsa Hellenic Hotels and Kiriacoulis Mediterranean Cruises 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.