Correlation Between Cuhadaroglu Metal and Kocaer Celik
Can any of the company-specific risk be diversified away by investing in both Cuhadaroglu Metal and Kocaer Celik 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 Cuhadaroglu Metal and Kocaer Celik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cuhadaroglu Metal Sanayi and Kocaer Celik Sanayi, you can compare the effects of market volatilities on Cuhadaroglu Metal and Kocaer Celik 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 Cuhadaroglu Metal with a short position of Kocaer Celik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cuhadaroglu Metal and Kocaer Celik.
Diversification Opportunities for Cuhadaroglu Metal and Kocaer Celik
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cuhadaroglu and Kocaer is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Cuhadaroglu Metal Sanayi and Kocaer Celik Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kocaer Celik Sanayi and Cuhadaroglu Metal 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 Cuhadaroglu Metal Sanayi are associated (or correlated) with Kocaer Celik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kocaer Celik Sanayi has no effect on the direction of Cuhadaroglu Metal i.e., Cuhadaroglu Metal and Kocaer Celik go up and down completely randomly.
Pair Corralation between Cuhadaroglu Metal and Kocaer Celik
Assuming the 90 days trading horizon Cuhadaroglu Metal is expected to generate 2.6 times less return on investment than Kocaer Celik. But when comparing it to its historical volatility, Cuhadaroglu Metal Sanayi is 1.0 times less risky than Kocaer Celik. It trades about 0.02 of its potential returns per unit of risk. Kocaer Celik Sanayi is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,290 in Kocaer Celik Sanayi on August 30, 2024 and sell it today you would earn a total of 1,840 from holding Kocaer Celik Sanayi or generate 80.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
Cuhadaroglu Metal Sanayi vs. Kocaer Celik Sanayi
Performance |
| Timeline |
| Cuhadaroglu Metal Sanayi |
| Kocaer Celik Sanayi |
Cuhadaroglu Metal and Kocaer Celik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cuhadaroglu Metal and Kocaer Celik
The main advantage of trading using opposite Cuhadaroglu Metal and Kocaer Celik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cuhadaroglu Metal position performs unexpectedly, Kocaer Celik 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 Kocaer Celik will offset losses from the drop in Kocaer Celik's long position.| Cuhadaroglu Metal vs. Haci Omer Sabanci | Cuhadaroglu Metal vs. Turkiye Petrol Rafinerileri | Cuhadaroglu Metal vs. Turkiye Garanti Bankasi | Cuhadaroglu Metal vs. Akbank TAS |
| Kocaer Celik vs. Gentas Genel Metal | Kocaer Celik vs. Qnb Finansbank AS | Kocaer Celik vs. Cuhadaroglu Metal Sanayi | Kocaer Celik vs. Sodas Sodyum Sanayi |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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