Correlation Between Ege Endustri and Pergamon Status

Can any of the company-specific risk be diversified away by investing in both Ege Endustri and Pergamon Status 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 Pergamon Status 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 Pergamon Status Dis, you can compare the effects of market volatilities on Ege Endustri and Pergamon Status 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 Pergamon Status. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ege Endustri and Pergamon Status.

Diversification Opportunities for Ege Endustri and Pergamon Status

-0.52

Correlation Coefficient

Ege Endustri  Pergamon Status

Excellent diversification

The 3 months correlation between Ege and Pergamon is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Ege Endustri ve and Pergamon Status Dis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pergamon Status Dis 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 Pergamon Status. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pergamon Status Dis has no effect on the direction of Ege Endustri i.e., Ege Endustri and Pergamon Status go up and down completely randomly.

Pair Corralation between Ege Endustri and Pergamon Status

Assuming the 90 days trading horizon Ege Endustri ve is expected to generate 0.68 times more return on investment than Pergamon Status. However, Ege Endustri ve is 1.48 times less risky than Pergamon Status. It trades about 0.05 of its potential returns per unit of risk. Pergamon Status Dis is currently generating about -0.1 per unit of risk. If you would invest  926,750  in Ege Endustri ve on October 11, 2024 and sell it today you would earn a total of  55,750  from holding Ege Endustri ve or generate 6.02% return on investment over 90 days.

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

Ege Endustri ve  vs.  Pergamon Status Dis

Ege Endustri ve

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ege Endustri ve are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Ege Endustri may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pergamon Status Dis

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pergamon Status Dis has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Ege Endustri and Pergamon Status

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

The idea behind Ege Endustri ve and Pergamon Status Dis 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..