Correlation Between Koza Anadolu and Ege Gubre
Can any of the company-specific risk be diversified away by investing in both Koza Anadolu and Ege Gubre 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 Koza Anadolu and Ege Gubre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koza Anadolu Metal and Ege Gubre Sanayi, you can compare the effects of market volatilities on Koza Anadolu and Ege Gubre 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 Koza Anadolu with a short position of Ege Gubre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koza Anadolu and Ege Gubre.
Diversification Opportunities for Koza Anadolu and Ege Gubre
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Koza and Ege is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Koza Anadolu Metal and Ege Gubre Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ege Gubre Sanayi and Koza Anadolu 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 Koza Anadolu Metal are associated (or correlated) with Ege Gubre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ege Gubre Sanayi has no effect on the direction of Koza Anadolu i.e., Koza Anadolu and Ege Gubre go up and down completely randomly.
Pair Corralation between Koza Anadolu and Ege Gubre
Assuming the 90 days trading horizon Koza Anadolu is expected to generate 2.05 times less return on investment than Ege Gubre. But when comparing it to its historical volatility, Koza Anadolu Metal is 2.15 times less risky than Ege Gubre. It trades about 0.04 of its potential returns per unit of risk. Ege Gubre Sanayi is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,705 in Ege Gubre Sanayi on August 26, 2024 and sell it today you would earn a total of 2,160 from holding Ege Gubre Sanayi or generate 58.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koza Anadolu Metal vs. Ege Gubre Sanayi
Performance |
| Timeline |
| Koza Anadolu Metal |
| Ege Gubre Sanayi |
Koza Anadolu and Ege Gubre Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koza Anadolu and Ege Gubre
The main advantage of trading using opposite Koza Anadolu and Ege Gubre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koza Anadolu position performs unexpectedly, Ege Gubre 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 Gubre will offset losses from the drop in Ege Gubre's long position.| Koza Anadolu vs. Qnb Finansbank AS | Koza Anadolu vs. QNB Finans Finansal | Koza Anadolu vs. Turkiye Kalkinma Bankasi | Koza Anadolu vs. Kocaer Celik Sanayi |
| Ege Gubre vs. Koza Anadolu Metal | Ege Gubre vs. Politeknik Metal Sanayi | Ege Gubre vs. ICBC Turkey Bank | Ege Gubre vs. Cuhadaroglu Metal 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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