Correlation Between Ege Endustri and Otokar Otomotiv
Can any of the company-specific risk be diversified away by investing in both Ege Endustri and Otokar Otomotiv 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 Otokar Otomotiv 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 Otokar Otomotiv ve, you can compare the effects of market volatilities on Ege Endustri and Otokar Otomotiv 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 Otokar Otomotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ege Endustri and Otokar Otomotiv.
Diversification Opportunities for Ege Endustri and Otokar Otomotiv
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ege and Otokar is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Ege Endustri ve and Otokar Otomotiv ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Otokar Otomotiv 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 Otokar Otomotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Otokar Otomotiv ve has no effect on the direction of Ege Endustri i.e., Ege Endustri and Otokar Otomotiv go up and down completely randomly.
Pair Corralation between Ege Endustri and Otokar Otomotiv
Assuming the 90 days trading horizon Ege Endustri ve is expected to generate 2.16 times more return on investment than Otokar Otomotiv. However, Ege Endustri is 2.16 times more volatile than Otokar Otomotiv ve. It trades about 0.15 of its potential returns per unit of risk. Otokar Otomotiv ve is currently generating about 0.11 per unit of risk. If you would invest 977,250 in Ege Endustri ve on August 24, 2024 and sell it today you would earn a total of 98,750 from holding Ege Endustri ve or generate 10.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ege Endustri ve vs. Otokar Otomotiv ve
Performance |
| Timeline |
| Ege Endustri ve |
| Otokar Otomotiv ve |
Ege Endustri and Otokar Otomotiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ege Endustri and Otokar Otomotiv
The main advantage of trading using opposite Ege Endustri and Otokar Otomotiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ege Endustri position performs unexpectedly, Otokar Otomotiv 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 Otokar Otomotiv will offset losses from the drop in Otokar Otomotiv's long position.| Ege Endustri vs. Qnb Finansbank AS | Ege Endustri vs. Kent Gida Maddeleri | Ege Endustri vs. QNB Finans Finansal | Ege Endustri vs. Turkiye Kalkinma Bankasi |
| Otokar Otomotiv vs. QNB Finans Finansal | Otokar Otomotiv vs. Pamel Yenilenebilir Elektrik | Otokar Otomotiv vs. Brisa Bridgestone Sabanci | Otokar Otomotiv vs. Dogus Gayrimenkul Yatirim |
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 Stocks Directory module to find actively traded stocks across global markets.
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