Correlation Between SASA Polyester and Politeknik Metal
Can any of the company-specific risk be diversified away by investing in both SASA Polyester and Politeknik Metal 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 Politeknik Metal 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 Politeknik Metal Sanayi, you can compare the effects of market volatilities on SASA Polyester and Politeknik Metal 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 Politeknik Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of SASA Polyester and Politeknik Metal.
Diversification Opportunities for SASA Polyester and Politeknik Metal
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SASA and Politeknik is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding SASA Polyester Sanayi and Politeknik Metal Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Politeknik Metal Sanayi 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 Politeknik Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Politeknik Metal Sanayi has no effect on the direction of SASA Polyester i.e., SASA Polyester and Politeknik Metal go up and down completely randomly.
Pair Corralation between SASA Polyester and Politeknik Metal
Assuming the 90 days trading horizon SASA Polyester is expected to generate 2.45 times less return on investment than Politeknik Metal. But when comparing it to its historical volatility, SASA Polyester Sanayi is 1.48 times less risky than Politeknik Metal. It trades about 0.1 of its potential returns per unit of risk. Politeknik Metal Sanayi is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 650,750 in Politeknik Metal Sanayi on September 1, 2024 and sell it today you would earn a total of 83,500 from holding Politeknik Metal Sanayi or generate 12.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
SASA Polyester Sanayi vs. Politeknik Metal Sanayi
Performance |
| Timeline |
| SASA Polyester Sanayi |
| Politeknik Metal Sanayi |
SASA Polyester and Politeknik Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SASA Polyester and Politeknik Metal
The main advantage of trading using opposite SASA Polyester and Politeknik Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SASA Polyester position performs unexpectedly, Politeknik Metal 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 Politeknik Metal will offset losses from the drop in Politeknik Metal's long position.| SASA Polyester vs. Hektas Ticaret TAS | SASA Polyester vs. Eregli Demir ve | SASA Polyester vs. Turkiye Sise ve | SASA Polyester vs. Turkiye Petrol Rafinerileri |
| Politeknik Metal vs. Cuhadaroglu Metal Sanayi | Politeknik Metal vs. Creditwest Faktoring AS | Politeknik Metal vs. Galatasaray Sportif Sinai | Politeknik Metal vs. Koza Anadolu Metal |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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