Correlation Between Eregli Demir and Koza Anadolu
Can any of the company-specific risk be diversified away by investing in both Eregli Demir and Koza Anadolu 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 Eregli Demir and Koza Anadolu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eregli Demir ve and Koza Anadolu Metal, you can compare the effects of market volatilities on Eregli Demir and Koza Anadolu 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 Eregli Demir with a short position of Koza Anadolu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eregli Demir and Koza Anadolu.
Diversification Opportunities for Eregli Demir and Koza Anadolu
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eregli and Koza is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Eregli Demir ve and Koza Anadolu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koza Anadolu Metal and Eregli Demir 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 Eregli Demir ve are associated (or correlated) with Koza Anadolu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koza Anadolu Metal has no effect on the direction of Eregli Demir i.e., Eregli Demir and Koza Anadolu go up and down completely randomly.
Pair Corralation between Eregli Demir and Koza Anadolu
Assuming the 90 days trading horizon Eregli Demir is expected to generate 2.17 times less return on investment than Koza Anadolu. But when comparing it to its historical volatility, Eregli Demir ve is 1.67 times less risky than Koza Anadolu. It trades about 0.14 of its potential returns per unit of risk. Koza Anadolu Metal is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 6,120 in Koza Anadolu Metal on August 31, 2024 and sell it today you would earn a total of 730.00 from holding Koza Anadolu Metal or generate 11.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eregli Demir ve vs. Koza Anadolu Metal
Performance |
| Timeline |
| Eregli Demir ve |
| Koza Anadolu Metal |
Eregli Demir and Koza Anadolu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eregli Demir and Koza Anadolu
The main advantage of trading using opposite Eregli Demir and Koza Anadolu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eregli Demir position performs unexpectedly, Koza Anadolu 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 Koza Anadolu will offset losses from the drop in Koza Anadolu's long position.| Eregli Demir vs. Turkiye Sise ve | Eregli Demir vs. Turkiye Petrol Rafinerileri | Eregli Demir vs. Ford Otomotiv Sanayi | Eregli Demir vs. Petkim Petrokimya Holding |
| Koza Anadolu vs. Trend Gayrimenkul Yatirim | Koza Anadolu vs. Trabzon Liman Isletmeciligi | Koza Anadolu vs. Halk Gayrimenkul Yatirim | Koza Anadolu vs. Inveo Yatirim Holding |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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