Correlation Between General Commercial and Technical Olympic

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

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

Diversification Opportunities for General Commercial and Technical Olympic

0.79

Correlation Coefficient

General Commercial  Technical Olympic

Poor diversification

The 3 months correlation between General and Technical is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding General Commercial Industrial and Technical Olympic SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Technical Olympic and General Commercial 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 General Commercial Industrial are associated (or correlated) with Technical Olympic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Technical Olympic has no effect on the direction of General Commercial i.e., General Commercial and Technical Olympic go up and down completely randomly.

Pair Corralation between General Commercial and Technical Olympic

Assuming the 90 days trading horizon General Commercial Industrial is expected to generate 1.31 times more return on investment than Technical Olympic. However, General Commercial is 1.31 times more volatile than Technical Olympic SA. It trades about 0.19 of its potential returns per unit of risk. Technical Olympic SA is currently generating about 0.24 per unit of risk. If you would invest  136.00  in General Commercial Industrial on April 23, 2025 and sell it today you would earn a total of  34.00  from holding General Commercial Industrial or generate 25.0% return on investment over 90 days.

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

General Commercial Industrial  vs.  Technical Olympic SA

General Commercial

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in General Commercial Industrial are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, General Commercial sustained solid returns over the last few months and may actually be approaching a breakup point.

Technical Olympic

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Technical Olympic SA are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Technical Olympic sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with General Commercial and Technical Olympic

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

The idea behind General Commercial Industrial and Technical Olympic 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.