Correlation Between Ege Endustri and Ekiz Kimya
Can any of the company-specific risk be diversified away by investing in both Ege Endustri and Ekiz Kimya 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 Ege Endustri and Ekiz Kimya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ege Endustri ve and Ekiz Kimya Sanayi, you can compare the effects of market volatilities on Ege Endustri and Ekiz Kimya 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 Ege Endustri with a short position of Ekiz Kimya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ege Endustri and Ekiz Kimya.
Diversification Opportunities for Ege Endustri and Ekiz Kimya
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ege and Ekiz is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ege Endustri ve and Ekiz Kimya Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekiz Kimya Sanayi and Ege Endustri 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 Ege Endustri ve are associated (or correlated) with Ekiz Kimya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekiz Kimya Sanayi has no effect on the direction of Ege Endustri i.e., Ege Endustri and Ekiz Kimya go up and down completely randomly.
Pair Corralation between Ege Endustri and Ekiz Kimya
Assuming the 90 days trading horizon Ege Endustri is expected to generate 1.88 times less return on investment than Ekiz Kimya. But when comparing it to its historical volatility, Ege Endustri ve is 1.29 times less risky than Ekiz Kimya. It trades about 0.05 of its potential returns per unit of risk. Ekiz Kimya Sanayi is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,778 in Ekiz Kimya Sanayi on October 4, 2024 and sell it today you would earn a total of 3,862 from holding Ekiz Kimya Sanayi or generate 217.21% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Ege Endustri ve vs. Ekiz Kimya Sanayi
Performance |
Timeline |
Ege Endustri ve |
Ekiz Kimya Sanayi |
Ege Endustri and Ekiz Kimya Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ege Endustri and Ekiz Kimya
The main advantage of trading using opposite Ege Endustri and Ekiz Kimya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ege Endustri position performs unexpectedly, Ekiz Kimya 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 Ekiz Kimya will offset losses from the drop in Ekiz Kimya's long position.Ege Endustri vs. Ford Otomotiv Sanayi | Ege Endustri vs. Tofas Turk Otomobil | Ege Endustri vs. Hektas Ticaret TAS | Ege Endustri 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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