Correlation Between MEGA METAL and Smart Gunes
Can any of the company-specific risk be diversified away by investing in both MEGA METAL and Smart Gunes 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 Smart Gunes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEGA METAL and Smart Gunes Enerjisi, you can compare the effects of market volatilities on MEGA METAL and Smart Gunes 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 Smart Gunes. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEGA METAL and Smart Gunes.
Diversification Opportunities for MEGA METAL and Smart Gunes
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MEGA and Smart is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding MEGA METAL and Smart Gunes Enerjisi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smart Gunes Enerjisi 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 Smart Gunes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smart Gunes Enerjisi has no effect on the direction of MEGA METAL i.e., MEGA METAL and Smart Gunes go up and down completely randomly.
Pair Corralation between MEGA METAL and Smart Gunes
Assuming the 90 days trading horizon MEGA METAL is expected to generate 1.08 times more return on investment than Smart Gunes. However, MEGA METAL is 1.08 times more volatile than Smart Gunes Enerjisi. It trades about -0.01 of its potential returns per unit of risk. Smart Gunes Enerjisi is currently generating about -0.07 per unit of risk. If you would invest 3,430 in MEGA METAL on September 1, 2024 and sell it today you would lose (326.00) from holding MEGA METAL or give up 9.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.2% |
| Values | Daily Returns |
MEGA METAL vs. Smart Gunes Enerjisi
Performance |
| Timeline |
| MEGA METAL |
| Smart Gunes Enerjisi |
MEGA METAL and Smart Gunes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEGA METAL and Smart Gunes
The main advantage of trading using opposite MEGA METAL and Smart Gunes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEGA METAL position performs unexpectedly, Smart Gunes 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 Smart Gunes will offset losses from the drop in Smart Gunes' long position.| MEGA METAL vs. ICBC Turkey Bank | MEGA METAL vs. Bms Birlesik Metal | MEGA METAL vs. Politeknik Metal Sanayi | MEGA METAL vs. Cuhadaroglu Metal Sanayi |
| Smart Gunes vs. MEGA METAL | Smart Gunes vs. Koza Anadolu Metal | Smart Gunes vs. Bms Birlesik Metal | Smart Gunes vs. Sodas Sodyum 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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