Correlation Between E Data and Soktas Tekstil

Can any of the company-specific risk be diversified away by investing in both E Data and Soktas Tekstil 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 E Data and Soktas Tekstil into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between E Data Teknoloji Pazarlama and Soktas Tekstil Sanayi, you can compare the effects of market volatilities on E Data and Soktas Tekstil 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 E Data with a short position of Soktas Tekstil. Check out your portfolio center. Please also check ongoing floating volatility patterns of E Data and Soktas Tekstil.

Diversification Opportunities for E Data and Soktas Tekstil

-0.05

Correlation Coefficient

E Data  Soktas Tekstil

Good diversification

The 3 months correlation between EDATA and Soktas is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding E Data Teknoloji Pazarlama and Soktas Tekstil Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soktas Tekstil Sanayi and E Data 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 E Data Teknoloji Pazarlama are associated (or correlated) with Soktas Tekstil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soktas Tekstil Sanayi has no effect on the direction of E Data i.e., E Data and Soktas Tekstil go up and down completely randomly.

Pair Corralation between E Data and Soktas Tekstil

Assuming the 90 days trading horizon E Data Teknoloji Pazarlama is expected to generate 0.82 times more return on investment than Soktas Tekstil. However, E Data Teknoloji Pazarlama is 1.22 times less risky than Soktas Tekstil. It trades about 0.02 of its potential returns per unit of risk. Soktas Tekstil Sanayi is currently generating about -0.02 per unit of risk. If you would invest  1,418  in E Data Teknoloji Pazarlama on October 26, 2024 and sell it today you would earn a total of  12.00  from holding E Data Teknoloji Pazarlama or generate 0.85% return on investment over 90 days.

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

E Data Teknoloji Pazarlama  vs.  Soktas Tekstil Sanayi

E Data Teknoloji

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in E Data Teknoloji Pazarlama are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, E Data is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Soktas Tekstil Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with E Data and Soktas Tekstil

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

The idea behind E Data Teknoloji Pazarlama and Soktas Tekstil Sanayi 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.