Correlation Between IZDEMIR Enerji and Ege Endustri
Can any of the company-specific risk be diversified away by investing in both IZDEMIR Enerji and Ege Endustri 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 IZDEMIR Enerji and Ege Endustri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IZDEMIR Enerji Elektrik and Ege Endustri ve, you can compare the effects of market volatilities on IZDEMIR Enerji and Ege Endustri 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 IZDEMIR Enerji with a short position of Ege Endustri. Check out your portfolio center. Please also check ongoing floating volatility patterns of IZDEMIR Enerji and Ege Endustri.
Diversification Opportunities for IZDEMIR Enerji and Ege Endustri
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IZDEMIR and Ege is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding IZDEMIR Enerji Elektrik and Ege Endustri ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ege Endustri ve and IZDEMIR Enerji 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 IZDEMIR Enerji Elektrik are associated (or correlated) with Ege Endustri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ege Endustri ve has no effect on the direction of IZDEMIR Enerji i.e., IZDEMIR Enerji and Ege Endustri go up and down completely randomly.
Pair Corralation between IZDEMIR Enerji and Ege Endustri
Assuming the 90 days trading horizon IZDEMIR Enerji is expected to generate 3.76 times less return on investment than Ege Endustri. In addition to that, IZDEMIR Enerji is 1.12 times more volatile than Ege Endustri ve. It trades about 0.02 of its total potential returns per unit of risk. Ege Endustri ve is currently generating about 0.08 per unit of volatility. If you would invest 438,394 in Ege Endustri ve on September 19, 2024 and sell it today you would earn a total of 591,606 from holding Ege Endustri ve or generate 134.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 86.19% |
| Values | Daily Returns |
IZDEMIR Enerji Elektrik vs. Ege Endustri ve
Performance |
| Timeline |
| IZDEMIR Enerji Elektrik |
| Ege Endustri ve |
IZDEMIR Enerji and Ege Endustri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IZDEMIR Enerji and Ege Endustri
The main advantage of trading using opposite IZDEMIR Enerji and Ege Endustri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IZDEMIR Enerji position performs unexpectedly, Ege Endustri 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 Ege Endustri will offset losses from the drop in Ege Endustri's long position.| IZDEMIR Enerji vs. SASA Polyester Sanayi | IZDEMIR Enerji vs. Turkish Airlines | IZDEMIR Enerji vs. Koc Holding AS | IZDEMIR Enerji vs. Ford Otomotiv Sanayi |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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