Correlation Between Arcelik AS and Aksa Akrilik

Can any of the company-specific risk be diversified away by investing in both Arcelik AS and Aksa Akrilik 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 Arcelik AS and Aksa Akrilik into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Arcelik AS and Aksa Akrilik Kimya, you can compare the effects of market volatilities on Arcelik AS and Aksa Akrilik 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 Arcelik AS with a short position of Aksa Akrilik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arcelik AS and Aksa Akrilik.

Diversification Opportunities for Arcelik AS and Aksa Akrilik

0.62

Correlation Coefficient

Arcelik AS  Aksa Akrilik

Poor diversification

The 3 months correlation between Arcelik and Aksa is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Arcelik AS and Aksa Akrilik Kimya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aksa Akrilik Kimya and Arcelik AS 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 Arcelik AS are associated (or correlated) with Aksa Akrilik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aksa Akrilik Kimya has no effect on the direction of Arcelik AS i.e., Arcelik AS and Aksa Akrilik go up and down completely randomly.

Pair Corralation between Arcelik AS and Aksa Akrilik

Assuming the 90 days trading horizon Arcelik AS is expected to under-perform the Aksa Akrilik. But the stock apears to be less risky and, when comparing its historical volatility, Arcelik AS is 1.3 times less risky than Aksa Akrilik. The stock trades about -0.01 of its potential returns per unit of risk. The Aksa Akrilik Kimya is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  866.00  in Aksa Akrilik Kimya on September 23, 2024 and sell it today you would earn a total of  275.00  from holding Aksa Akrilik Kimya or generate 31.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Arcelik AS  vs.  Aksa Akrilik Kimya

Arcelik AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Arcelik AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Arcelik AS is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Aksa Akrilik Kimya

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aksa Akrilik Kimya are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Aksa Akrilik unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Arcelik AS and Aksa Akrilik

The main advantage of trading using opposite Arcelik AS and Aksa Akrilik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arcelik AS position performs unexpectedly, Aksa Akrilik 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 Aksa Akrilik will offset losses from the drop in Aksa Akrilik's long position.

The idea behind Arcelik AS and Aksa Akrilik Kimya pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.