Correlation Between Politeknik Metal and AG Anadolu
Can any of the company-specific risk be diversified away by investing in both Politeknik Metal and AG Anadolu 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 Politeknik Metal and AG Anadolu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Politeknik Metal Sanayi and AG Anadolu Group, you can compare the effects of market volatilities on Politeknik Metal and AG Anadolu 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 Politeknik Metal with a short position of AG Anadolu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Politeknik Metal and AG Anadolu.
Diversification Opportunities for Politeknik Metal and AG Anadolu
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Politeknik and AGHOL is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Politeknik Metal Sanayi and AG Anadolu Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AG Anadolu Group and Politeknik 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 Politeknik Metal Sanayi are associated (or correlated) with AG Anadolu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AG Anadolu Group has no effect on the direction of Politeknik Metal i.e., Politeknik Metal and AG Anadolu go up and down completely randomly.
Pair Corralation between Politeknik Metal and AG Anadolu
Assuming the 90 days trading horizon Politeknik Metal Sanayi is expected to under-perform the AG Anadolu. In addition to that, Politeknik Metal is 1.5 times more volatile than AG Anadolu Group. It trades about -0.14 of its total potential returns per unit of risk. AG Anadolu Group is currently generating about -0.02 per unit of volatility. If you would invest 35,750 in AG Anadolu Group on September 1, 2024 and sell it today you would lose (3,200) from holding AG Anadolu Group or give up 8.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Politeknik Metal Sanayi vs. AG Anadolu Group
Performance |
| Timeline |
| Politeknik Metal Sanayi |
| AG Anadolu Group |
Politeknik Metal and AG Anadolu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Politeknik Metal and AG Anadolu
The main advantage of trading using opposite Politeknik Metal and AG Anadolu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Politeknik Metal position performs unexpectedly, AG Anadolu 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 AG Anadolu will offset losses from the drop in AG Anadolu's long position.| Politeknik Metal vs. Cuhadaroglu Metal Sanayi | Politeknik Metal vs. Creditwest Faktoring AS | Politeknik Metal vs. Galatasaray Sportif Sinai | Politeknik Metal vs. Koza Anadolu Metal |
| AG Anadolu vs. Akcansa Cimento Sanayi | AG Anadolu vs. Turkiye Kalkinma Bankasi | AG Anadolu vs. Gentas Genel Metal | AG Anadolu vs. Sekerbank TAS |
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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