Correlation Between Ege Endustri and Politeknik Metal
Can any of the company-specific risk be diversified away by investing in both Ege Endustri and Politeknik 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 Ege Endustri and Politeknik Metal 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 Politeknik Metal Sanayi, you can compare the effects of market volatilities on Ege Endustri and Politeknik 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 Ege Endustri with a short position of Politeknik Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ege Endustri and Politeknik Metal.
Diversification Opportunities for Ege Endustri and Politeknik Metal
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ege and Politeknik is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Ege Endustri ve and Politeknik Metal Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Politeknik Metal Sanayi 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 Politeknik Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Politeknik Metal Sanayi has no effect on the direction of Ege Endustri i.e., Ege Endustri and Politeknik Metal go up and down completely randomly.
Pair Corralation between Ege Endustri and Politeknik Metal
Assuming the 90 days trading horizon Ege Endustri ve is expected to under-perform the Politeknik Metal. But the stock apears to be less risky and, when comparing its historical volatility, Ege Endustri ve is 1.83 times less risky than Politeknik Metal. The stock trades about -0.2 of its potential returns per unit of risk. The Politeknik Metal Sanayi is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 637,250 in Politeknik Metal Sanayi on September 12, 2024 and sell it today you would earn a total of 74,750 from holding Politeknik Metal Sanayi or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ege Endustri ve vs. Politeknik Metal Sanayi
Performance |
| Timeline |
| Ege Endustri ve |
| Politeknik Metal Sanayi |
Ege Endustri and Politeknik Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ege Endustri and Politeknik Metal
The main advantage of trading using opposite Ege Endustri and Politeknik Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ege Endustri position performs unexpectedly, Politeknik 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 Politeknik Metal will offset losses from the drop in Politeknik Metal'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 |
| Politeknik Metal vs. Ayes Celik Hasir | Politeknik Metal vs. Trend Gayrimenkul Yatirim | Politeknik Metal vs. Ege Endustri ve | Politeknik Metal vs. Alarko Carrier 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 CEOs Directory module to screen CEOs from public companies around the world.
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