Correlation Between Aselsan Elektronik and MEGA METAL
Can any of the company-specific risk be diversified away by investing in both Aselsan Elektronik and MEGA 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 Aselsan Elektronik and MEGA METAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aselsan Elektronik Sanayi and MEGA METAL, you can compare the effects of market volatilities on Aselsan Elektronik and MEGA 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 Aselsan Elektronik with a short position of MEGA METAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aselsan Elektronik and MEGA METAL.
Diversification Opportunities for Aselsan Elektronik and MEGA METAL
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aselsan and MEGA is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Aselsan Elektronik Sanayi and MEGA METAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEGA METAL and Aselsan Elektronik 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 Aselsan Elektronik Sanayi are associated (or correlated) with MEGA METAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEGA METAL has no effect on the direction of Aselsan Elektronik i.e., Aselsan Elektronik and MEGA METAL go up and down completely randomly.
Pair Corralation between Aselsan Elektronik and MEGA METAL
Assuming the 90 days trading horizon Aselsan Elektronik Sanayi is expected to generate 0.63 times more return on investment than MEGA METAL. However, Aselsan Elektronik Sanayi is 1.59 times less risky than MEGA METAL. It trades about 0.14 of its potential returns per unit of risk. MEGA METAL is currently generating about 0.03 per unit of risk. If you would invest 7,030 in Aselsan Elektronik Sanayi on October 5, 2024 and sell it today you would earn a total of 320.00 from holding Aselsan Elektronik Sanayi or generate 4.55% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Aselsan Elektronik Sanayi vs. MEGA METAL
Performance |
Timeline |
Aselsan Elektronik Sanayi |
MEGA METAL |
Aselsan Elektronik and MEGA METAL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aselsan Elektronik and MEGA METAL
The main advantage of trading using opposite Aselsan Elektronik and MEGA METAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aselsan Elektronik position performs unexpectedly, MEGA 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 MEGA METAL will offset losses from the drop in MEGA METAL's long position.Aselsan Elektronik vs. Turkish Airlines | Aselsan Elektronik vs. Turkiye Petrol Rafinerileri | Aselsan Elektronik vs. Petkim Petrokimya Holding | Aselsan Elektronik vs. Eregli Demir ve |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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