Correlation Between Ege Endustri and Sodas Sodyum
Can any of the company-specific risk be diversified away by investing in both Ege Endustri and Sodas Sodyum 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 Sodas Sodyum 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 Sodas Sodyum Sanayi, you can compare the effects of market volatilities on Ege Endustri and Sodas Sodyum 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 Sodas Sodyum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ege Endustri and Sodas Sodyum.
Diversification Opportunities for Ege Endustri and Sodas Sodyum
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ege and Sodas is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Ege Endustri ve and Sodas Sodyum Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sodas Sodyum 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 Sodas Sodyum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sodas Sodyum Sanayi has no effect on the direction of Ege Endustri i.e., Ege Endustri and Sodas Sodyum go up and down completely randomly.
Pair Corralation between Ege Endustri and Sodas Sodyum
Assuming the 90 days trading horizon Ege Endustri ve is expected to under-perform the Sodas Sodyum. But the stock apears to be less risky and, when comparing its historical volatility, Ege Endustri ve is 1.23 times less risky than Sodas Sodyum. The stock trades about -0.16 of its potential returns per unit of risk. The Sodas Sodyum Sanayi is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 10,520 in Sodas Sodyum Sanayi on December 3, 2024 and sell it today you would lose (1,575) from holding Sodas Sodyum Sanayi or give up 14.97% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Ege Endustri ve vs. Sodas Sodyum Sanayi
Performance |
Timeline |
Ege Endustri ve |
Sodas Sodyum Sanayi |
Ege Endustri and Sodas Sodyum Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ege Endustri and Sodas Sodyum
The main advantage of trading using opposite Ege Endustri and Sodas Sodyum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ege Endustri position performs unexpectedly, Sodas Sodyum 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 Sodas Sodyum will offset losses from the drop in Sodas Sodyum'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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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