Correlation Between Koza Altin and Ipek Dogal

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Can any of the company-specific risk be diversified away by investing in both Koza Altin and Ipek Dogal 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 Altin and Ipek Dogal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koza Altin Isletmeleri and Ipek Dogal Enerji, you can compare the effects of market volatilities on Koza Altin and Ipek Dogal 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 Altin with a short position of Ipek Dogal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koza Altin and Ipek Dogal.

Diversification Opportunities for Koza Altin and Ipek Dogal

0.82
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Koza and Ipek is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Koza Altin Isletmeleri and Ipek Dogal Enerji in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ipek Dogal Enerji and Koza Altin 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 Altin Isletmeleri are associated (or correlated) with Ipek Dogal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ipek Dogal Enerji has no effect on the direction of Koza Altin i.e., Koza Altin and Ipek Dogal go up and down completely randomly.

Pair Corralation between Koza Altin and Ipek Dogal

Assuming the 90 days trading horizon Koza Altin is expected to generate 20.28 times less return on investment than Ipek Dogal. But when comparing it to its historical volatility, Koza Altin Isletmeleri is 1.11 times less risky than Ipek Dogal. It trades about 0.03 of its potential returns per unit of risk. Ipek Dogal Enerji is currently generating about 0.59 of returns per unit of risk over similar time horizon. If you would invest  3,510  in Ipek Dogal Enerji on August 28, 2024 and sell it today you would earn a total of  1,605  from holding Ipek Dogal Enerji or generate 45.73% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Koza Altin Isletmeleri  vs.  Ipek Dogal Enerji

 Performance 
       Timeline  
Koza Altin Isletmeleri 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Koza Altin Isletmeleri has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in December 2024. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.
Ipek Dogal Enerji 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Ipek Dogal Enerji are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Ipek Dogal demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Koza Altin and Ipek Dogal Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Koza Altin and Ipek Dogal

The main advantage of trading using opposite Koza Altin and Ipek Dogal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koza Altin position performs unexpectedly, Ipek Dogal 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 Ipek Dogal will offset losses from the drop in Ipek Dogal's long position.
The idea behind Koza Altin Isletmeleri and Ipek Dogal Enerji pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

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