Correlation Between Deva Holding and Aksa Enerji

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

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

Diversification Opportunities for Deva Holding and Aksa Enerji

0.83

Correlation Coefficient

Deva Holding  Aksa Enerji

Very poor diversification

The 3 months correlation between Deva and Aksa is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Deva Holding AS and Aksa Enerji Uretim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aksa Enerji Uretim and Deva Holding 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 Deva Holding AS are associated (or correlated) with Aksa Enerji. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aksa Enerji Uretim has no effect on the direction of Deva Holding i.e., Deva Holding and Aksa Enerji go up and down completely randomly.

Pair Corralation between Deva Holding and Aksa Enerji

Assuming the 90 days trading horizon Deva Holding AS is expected to under-perform the Aksa Enerji. In addition to that, Deva Holding is 1.1 times more volatile than Aksa Enerji Uretim. It trades about -0.05 of its total potential returns per unit of risk. Aksa Enerji Uretim is currently generating about -0.01 per unit of volatility. If you would invest  4,390  in Aksa Enerji Uretim on October 13, 2024 and sell it today you would lose (296.00) from holding Aksa Enerji Uretim or give up 6.74% of portfolio value over 90 days.

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

Deva Holding AS  vs.  Aksa Enerji Uretim

Deva Holding AS

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Deva Holding AS are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Deva Holding unveiled solid returns over the last few months and may actually be approaching a breakup point.

Aksa Enerji Uretim

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aksa Enerji Uretim are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Aksa Enerji demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Deva Holding and Aksa Enerji

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

The idea behind Deva Holding AS and Aksa Enerji Uretim 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.

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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.