Correlation Between MEGA METAL and Gentas Genel
Can any of the company-specific risk be diversified away by investing in both MEGA METAL and Gentas Genel 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 MEGA METAL and Gentas Genel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEGA METAL and Gentas Genel Metal, you can compare the effects of market volatilities on MEGA METAL and Gentas Genel 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 MEGA METAL with a short position of Gentas Genel. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEGA METAL and Gentas Genel.
Diversification Opportunities for MEGA METAL and Gentas Genel
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MEGA and Gentas is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding MEGA METAL and Gentas Genel Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentas Genel Metal and MEGA METAL 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 MEGA METAL are associated (or correlated) with Gentas Genel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentas Genel Metal has no effect on the direction of MEGA METAL i.e., MEGA METAL and Gentas Genel go up and down completely randomly.
Pair Corralation between MEGA METAL and Gentas Genel
Assuming the 90 days trading horizon MEGA METAL is expected to under-perform the Gentas Genel. But the stock apears to be less risky and, when comparing its historical volatility, MEGA METAL is 1.28 times less risky than Gentas Genel. The stock trades about -0.03 of its potential returns per unit of risk. The Gentas Genel Metal is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 750.00 in Gentas Genel Metal on August 28, 2024 and sell it today you would earn a total of 100.00 from holding Gentas Genel Metal or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MEGA METAL vs. Gentas Genel Metal
Performance |
| Timeline |
| MEGA METAL |
| Gentas Genel Metal |
MEGA METAL and Gentas Genel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEGA METAL and Gentas Genel
The main advantage of trading using opposite MEGA METAL and Gentas Genel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEGA METAL position performs unexpectedly, Gentas Genel 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 Gentas Genel will offset losses from the drop in Gentas Genel's long position.| MEGA METAL vs. Turkish Airlines | MEGA METAL vs. Koc Holding AS | MEGA METAL vs. Ford Otomotiv Sanayi | MEGA METAL vs. Turkiye Petrol Rafinerileri |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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