Correlation Between Ege Endustri and ENKA Insaat
Can any of the company-specific risk be diversified away by investing in both Ege Endustri and ENKA Insaat 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 Ege Endustri and ENKA Insaat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ege Endustri ve and ENKA Insaat ve, you can compare the effects of market volatilities on Ege Endustri and ENKA Insaat 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 Ege Endustri with a short position of ENKA Insaat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ege Endustri and ENKA Insaat.
Diversification Opportunities for Ege Endustri and ENKA Insaat
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ege and ENKA is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ege Endustri ve and ENKA Insaat ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENKA Insaat ve and Ege Endustri 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 Ege Endustri ve are associated (or correlated) with ENKA Insaat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENKA Insaat ve has no effect on the direction of Ege Endustri i.e., Ege Endustri and ENKA Insaat go up and down completely randomly.
Pair Corralation between Ege Endustri and ENKA Insaat
Assuming the 90 days trading horizon Ege Endustri ve is expected to under-perform the ENKA Insaat. But the stock apears to be less risky and, when comparing its historical volatility, Ege Endustri ve is 1.27 times less risky than ENKA Insaat. The stock trades about -0.2 of its potential returns per unit of risk. The ENKA Insaat ve is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 5,205 in ENKA Insaat ve on September 12, 2024 and sell it today you would earn a total of 150.00 from holding ENKA Insaat ve or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ege Endustri ve vs. ENKA Insaat ve
Performance |
| Timeline |
| Ege Endustri ve |
| ENKA Insaat ve |
Ege Endustri and ENKA Insaat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ege Endustri and ENKA Insaat
The main advantage of trading using opposite Ege Endustri and ENKA Insaat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ege Endustri position performs unexpectedly, ENKA Insaat 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 ENKA Insaat will offset losses from the drop in ENKA Insaat's long position.| Ege Endustri vs. Ford Otomotiv Sanayi | Ege Endustri vs. Tofas Turk Otomobil | Ege Endustri vs. Hektas Ticaret TAS | Ege Endustri vs. Eregli Demir ve |
| ENKA Insaat vs. Ege Endustri ve | ENKA Insaat vs. Turkiye Petrol Rafinerileri | ENKA Insaat vs. Turkiye Garanti Bankasi | ENKA Insaat vs. Turkish Airlines |
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 CEOs Directory module to screen CEOs from public companies around the world.
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