Correlation Between Akbank TAS and MEGA METAL
Can any of the company-specific risk be diversified away by investing in both Akbank TAS and MEGA METAL 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 Akbank TAS and MEGA METAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akbank TAS and MEGA METAL, you can compare the effects of market volatilities on Akbank TAS and MEGA METAL 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 Akbank TAS with a short position of MEGA METAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akbank TAS and MEGA METAL.
Diversification Opportunities for Akbank TAS and MEGA METAL
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Akbank and MEGA is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Akbank TAS and MEGA METAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEGA METAL and Akbank TAS 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 Akbank TAS are associated (or correlated) with MEGA METAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEGA METAL has no effect on the direction of Akbank TAS i.e., Akbank TAS and MEGA METAL go up and down completely randomly.
Pair Corralation between Akbank TAS and MEGA METAL
Assuming the 90 days trading horizon Akbank TAS is expected to generate 1.96 times more return on investment than MEGA METAL. However, Akbank TAS is 1.96 times more volatile than MEGA METAL. It trades about 0.23 of its potential returns per unit of risk. MEGA METAL is currently generating about -0.02 per unit of risk. If you would invest 5,100 in Akbank TAS on August 30, 2024 and sell it today you would earn a total of 845.00 from holding Akbank TAS or generate 16.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akbank TAS vs. MEGA METAL
Performance |
| Timeline |
| Akbank TAS |
| MEGA METAL |
Akbank TAS and MEGA METAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akbank TAS and MEGA METAL
The main advantage of trading using opposite Akbank TAS and MEGA METAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akbank TAS position performs unexpectedly, MEGA METAL 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 MEGA METAL will offset losses from the drop in MEGA METAL's long position.| Akbank TAS vs. Turkiye Garanti Bankasi | Akbank TAS vs. Yapi ve Kredi | Akbank TAS vs. Turkiye Is Bankasi | Akbank TAS vs. Koc Holding AS |
| MEGA METAL vs. Datagate Bilgisayar Malzemeleri | MEGA METAL vs. Koza Anadolu Metal | MEGA METAL vs. Politeknik Metal Sanayi | MEGA METAL vs. Akbank TAS |
Check out your portfolio center.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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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