Correlation Between SASA Polyester and Papilon Savunma
Can any of the company-specific risk be diversified away by investing in both SASA Polyester and Papilon Savunma 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 SASA Polyester and Papilon Savunma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SASA Polyester Sanayi and Papilon Savunma Guvenlik, you can compare the effects of market volatilities on SASA Polyester and Papilon Savunma 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 SASA Polyester with a short position of Papilon Savunma. Check out your portfolio center. Please also check ongoing floating volatility patterns of SASA Polyester and Papilon Savunma.
Diversification Opportunities for SASA Polyester and Papilon Savunma
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SASA and Papilon is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding SASA Polyester Sanayi and Papilon Savunma Guvenlik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Papilon Savunma Guvenlik and SASA Polyester 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 SASA Polyester Sanayi are associated (or correlated) with Papilon Savunma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Papilon Savunma Guvenlik has no effect on the direction of SASA Polyester i.e., SASA Polyester and Papilon Savunma go up and down completely randomly.
Pair Corralation between SASA Polyester and Papilon Savunma
Assuming the 90 days trading horizon SASA Polyester Sanayi is expected to under-perform the Papilon Savunma. But the stock apears to be less risky and, when comparing its historical volatility, SASA Polyester Sanayi is 2.25 times less risky than Papilon Savunma. The stock trades about -0.05 of its potential returns per unit of risk. The Papilon Savunma Guvenlik is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,064 in Papilon Savunma Guvenlik on September 27, 2024 and sell it today you would earn a total of 218.00 from holding Papilon Savunma Guvenlik or generate 20.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
SASA Polyester Sanayi vs. Papilon Savunma Guvenlik
Performance |
| Timeline |
| SASA Polyester Sanayi |
| Papilon Savunma Guvenlik |
SASA Polyester and Papilon Savunma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SASA Polyester and Papilon Savunma
The main advantage of trading using opposite SASA Polyester and Papilon Savunma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SASA Polyester position performs unexpectedly, Papilon Savunma 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 Papilon Savunma will offset losses from the drop in Papilon Savunma's long position.| SASA Polyester vs. Ege Endustri ve | SASA Polyester vs. Bosch Fren Sistemleri | SASA Polyester vs. Dogus Otomotiv Servis | SASA Polyester vs. Nuh Cimento Sanayi |
| Papilon Savunma vs. SASA Polyester Sanayi | Papilon Savunma vs. Turkish Airlines | Papilon Savunma vs. Koc Holding AS | Papilon Savunma vs. Ford Otomotiv 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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