Correlation Between Politeknik Metal and Cimentas Izmir
Can any of the company-specific risk be diversified away by investing in both Politeknik Metal and Cimentas Izmir 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 Cimentas Izmir 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 Cimentas Izmir Cimento, you can compare the effects of market volatilities on Politeknik Metal and Cimentas Izmir 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 Cimentas Izmir. Check out your portfolio center. Please also check ongoing floating volatility patterns of Politeknik Metal and Cimentas Izmir.
Diversification Opportunities for Politeknik Metal and Cimentas Izmir
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Politeknik and Cimentas is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Politeknik Metal Sanayi and Cimentas Izmir Cimento in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cimentas Izmir Cimento 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 Cimentas Izmir. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cimentas Izmir Cimento has no effect on the direction of Politeknik Metal i.e., Politeknik Metal and Cimentas Izmir go up and down completely randomly.
Pair Corralation between Politeknik Metal and Cimentas Izmir
Assuming the 90 days trading horizon Politeknik Metal Sanayi is expected to generate 1.1 times more return on investment than Cimentas Izmir. However, Politeknik Metal is 1.1 times more volatile than Cimentas Izmir Cimento. It trades about 0.04 of its potential returns per unit of risk. Cimentas Izmir Cimento is currently generating about 0.02 per unit of risk. If you would invest 629,750 in Politeknik Metal Sanayi on November 8, 2024 and sell it today you would earn a total of 36,250 from holding Politeknik Metal Sanayi or generate 5.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Politeknik Metal Sanayi vs. Cimentas Izmir Cimento
Performance |
| Timeline |
| Politeknik Metal Sanayi |
| Cimentas Izmir Cimento |
Politeknik Metal and Cimentas Izmir Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Politeknik Metal and Cimentas Izmir
The main advantage of trading using opposite Politeknik Metal and Cimentas Izmir positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Politeknik Metal position performs unexpectedly, Cimentas Izmir 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 Cimentas Izmir will offset losses from the drop in Cimentas Izmir's long position.| Politeknik Metal vs. Gentas Genel Metal | Politeknik Metal vs. Datagate Bilgisayar Malzemeleri | Politeknik Metal vs. Bms Birlesik Metal | Politeknik Metal vs. KOC METALURJI |
| Cimentas Izmir vs. Bms Birlesik Metal | Cimentas Izmir vs. Gentas Genel Metal | Cimentas Izmir vs. Trabzonspor Sportif Yatirim | Cimentas Izmir vs. Silverline Endustri ve |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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