Correlation Between Eminis Ambalaj and Karsan Otomotiv
Can any of the company-specific risk be diversified away by investing in both Eminis Ambalaj and Karsan 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 Eminis Ambalaj and Karsan Otomotiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eminis Ambalaj Sanayi and Karsan Otomotiv Sanayi, you can compare the effects of market volatilities on Eminis Ambalaj and Karsan 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 Eminis Ambalaj with a short position of Karsan Otomotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eminis Ambalaj and Karsan Otomotiv.
Diversification Opportunities for Eminis Ambalaj and Karsan Otomotiv
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eminis and Karsan is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Eminis Ambalaj Sanayi and Karsan Otomotiv Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Karsan Otomotiv Sanayi and Eminis Ambalaj 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 Eminis Ambalaj Sanayi are associated (or correlated) with Karsan Otomotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Karsan Otomotiv Sanayi has no effect on the direction of Eminis Ambalaj i.e., Eminis Ambalaj and Karsan Otomotiv go up and down completely randomly.
Pair Corralation between Eminis Ambalaj and Karsan Otomotiv
Assuming the 90 days trading horizon Eminis Ambalaj Sanayi is expected to generate 1.09 times more return on investment than Karsan Otomotiv. However, Eminis Ambalaj is 1.09 times more volatile than Karsan Otomotiv Sanayi. It trades about -0.07 of its potential returns per unit of risk. Karsan Otomotiv Sanayi is currently generating about -0.2 per unit of risk. If you would invest 30,000 in Eminis Ambalaj Sanayi on August 30, 2024 and sell it today you would lose (3,550) from holding Eminis Ambalaj Sanayi or give up 11.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eminis Ambalaj Sanayi vs. Karsan Otomotiv Sanayi
Performance |
| Timeline |
| Eminis Ambalaj Sanayi |
| Karsan Otomotiv Sanayi |
Eminis Ambalaj and Karsan Otomotiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eminis Ambalaj and Karsan Otomotiv
The main advantage of trading using opposite Eminis Ambalaj and Karsan Otomotiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eminis Ambalaj position performs unexpectedly, Karsan 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 Karsan Otomotiv will offset losses from the drop in Karsan Otomotiv's long position.| Eminis Ambalaj vs. Cuhadaroglu Metal Sanayi | Eminis Ambalaj vs. Koza Anadolu Metal | Eminis Ambalaj vs. Mackolik Internet Hizmetleri | Eminis Ambalaj vs. ICBC Turkey Bank |
| Karsan Otomotiv vs. E Data Teknoloji Pazarlama | Karsan Otomotiv vs. Koza Anadolu Metal | Karsan Otomotiv vs. Akbank TAS | Karsan Otomotiv vs. ICBC Turkey Bank |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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