Correlation Between Politeknik Metal and DO AG
Can any of the company-specific risk be diversified away by investing in both Politeknik Metal and DO AG 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 DO AG 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 DO AG, you can compare the effects of market volatilities on Politeknik Metal and DO AG 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 DO AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Politeknik Metal and DO AG.
Diversification Opportunities for Politeknik Metal and DO AG
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Politeknik and DOCO is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Politeknik Metal Sanayi and DO AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DO AG 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 DO AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DO AG has no effect on the direction of Politeknik Metal i.e., Politeknik Metal and DO AG go up and down completely randomly.
Pair Corralation between Politeknik Metal and DO AG
Assuming the 90 days trading horizon Politeknik Metal Sanayi is expected to under-perform the DO AG. In addition to that, Politeknik Metal is 1.84 times more volatile than DO AG. It trades about -0.03 of its total potential returns per unit of risk. DO AG is currently generating about 0.09 per unit of volatility. If you would invest 393,000 in DO AG on September 14, 2024 and sell it today you would earn a total of 238,500 from holding DO AG or generate 60.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Politeknik Metal Sanayi vs. DO AG
Performance |
| Timeline |
| Politeknik Metal Sanayi |
| DO AG |
Politeknik Metal and DO AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Politeknik Metal and DO AG
The main advantage of trading using opposite Politeknik Metal and DO AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Politeknik Metal position performs unexpectedly, DO AG 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 DO AG will offset losses from the drop in DO AG's long position.| Politeknik Metal vs. Turkiye Kalkinma Bankasi | Politeknik Metal vs. Bms Birlesik Metal | Politeknik Metal vs. Datagate Bilgisayar Malzemeleri | Politeknik Metal vs. Akcansa Cimento Sanayi |
| DO AG vs. Politeknik Metal Sanayi | DO AG vs. Trabzonspor Sportif Yatirim | DO AG vs. Silverline Endustri ve | DO AG vs. Akcansa Cimento 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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