Correlation Between Tofas Turk and Ege Endustri
Can any of the company-specific risk be diversified away by investing in both Tofas Turk and Ege Endustri 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 Tofas Turk and Ege Endustri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tofas Turk Otomobil and Ege Endustri ve, you can compare the effects of market volatilities on Tofas Turk and Ege Endustri 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 Tofas Turk with a short position of Ege Endustri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tofas Turk and Ege Endustri.
Diversification Opportunities for Tofas Turk and Ege Endustri
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tofas and Ege is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Tofas Turk Otomobil and Ege Endustri ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ege Endustri ve and Tofas Turk 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 Tofas Turk Otomobil are associated (or correlated) with Ege Endustri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ege Endustri ve has no effect on the direction of Tofas Turk i.e., Tofas Turk and Ege Endustri go up and down completely randomly.
Pair Corralation between Tofas Turk and Ege Endustri
Assuming the 90 days trading horizon Tofas Turk Otomobil is expected to under-perform the Ege Endustri. But the stock apears to be less risky and, when comparing its historical volatility, Tofas Turk Otomobil is 1.4 times less risky than Ege Endustri. The stock trades about 0.0 of its potential returns per unit of risk. The Ege Endustri ve is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,259,139 in Ege Endustri ve on August 29, 2024 and sell it today you would lose (170,389) from holding Ege Endustri ve or give up 13.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tofas Turk Otomobil vs. Ege Endustri ve
Performance |
| Timeline |
| Tofas Turk Otomobil |
| Ege Endustri ve |
Tofas Turk and Ege Endustri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tofas Turk and Ege Endustri
The main advantage of trading using opposite Tofas Turk and Ege Endustri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tofas Turk position performs unexpectedly, Ege Endustri 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 Ege Endustri will offset losses from the drop in Ege Endustri's long position.| Tofas Turk vs. Ford Otomotiv Sanayi | Tofas Turk vs. Eregli Demir ve | Tofas Turk vs. Turkiye Petrol Rafinerileri | Tofas Turk vs. Turkiye Sise ve |
| Ege Endustri vs. Ford Otomotiv Sanayi | Ege Endustri vs. Tofas Turk Otomobil | Ege Endustri vs. Hektas Ticaret TAS | Ege Endustri vs. Eregli Demir 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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