Correlation Between Frigo Pak and Politeknik Metal
Can any of the company-specific risk be diversified away by investing in both Frigo Pak 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 Frigo Pak and Politeknik Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Frigo Pak Gida Maddeleri and Politeknik Metal Sanayi, you can compare the effects of market volatilities on Frigo Pak 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 Frigo Pak with a short position of Politeknik Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Frigo Pak and Politeknik Metal.
Diversification Opportunities for Frigo Pak and Politeknik Metal
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Frigo and Politeknik is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Frigo Pak Gida Maddeleri 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 Frigo Pak 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 Frigo Pak Gida Maddeleri 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 Frigo Pak i.e., Frigo Pak and Politeknik Metal go up and down completely randomly.
Pair Corralation between Frigo Pak and Politeknik Metal
Assuming the 90 days trading horizon Frigo Pak is expected to generate 1.04 times less return on investment than Politeknik Metal. But when comparing it to its historical volatility, Frigo Pak Gida Maddeleri is 1.55 times less risky than Politeknik Metal. It trades about 0.05 of its potential returns per unit of risk. Politeknik Metal Sanayi is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 684,000 in Politeknik Metal Sanayi on October 24, 2024 and sell it today you would earn a total of 8,500 from holding Politeknik Metal Sanayi or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Frigo Pak Gida Maddeleri vs. Politeknik Metal Sanayi
Performance |
| Timeline |
| Frigo Pak Gida |
| Politeknik Metal Sanayi |
Frigo Pak and Politeknik Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Frigo Pak and Politeknik Metal
The main advantage of trading using opposite Frigo Pak and Politeknik Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Frigo Pak 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.| Frigo Pak vs. Yesil Yatirim Holding | Frigo Pak vs. Trend Gayrimenkul Yatirim | Frigo Pak vs. Escort Teknoloji Yatirim | Frigo Pak vs. Marmaris Altinyunus Turistik |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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