Correlation Between Eregli Demir and Saray Matbaacilik

Can any of the company-specific risk be diversified away by investing in both Eregli Demir and Saray Matbaacilik 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 Eregli Demir and Saray Matbaacilik into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Eregli Demir ve and Saray Matbaacilik Kagitcilik, you can compare the effects of market volatilities on Eregli Demir and Saray Matbaacilik 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 Eregli Demir with a short position of Saray Matbaacilik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eregli Demir and Saray Matbaacilik.

Diversification Opportunities for Eregli Demir and Saray Matbaacilik

-0.43

Correlation Coefficient

Eregli Demir  Saray Matbaacilik

Very good diversification

The 3 months correlation between Eregli and Saray is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Eregli Demir ve and Saray Matbaacilik Kagitcilik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saray Matbaacilik and Eregli Demir 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 Eregli Demir ve are associated (or correlated) with Saray Matbaacilik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saray Matbaacilik has no effect on the direction of Eregli Demir i.e., Eregli Demir and Saray Matbaacilik go up and down completely randomly.

Pair Corralation between Eregli Demir and Saray Matbaacilik

Assuming the 90 days trading horizon Eregli Demir ve is expected to under-perform the Saray Matbaacilik. But the stock apears to be less risky and, when comparing its historical volatility, Eregli Demir ve is 2.48 times less risky than Saray Matbaacilik. The stock trades about -0.45 of its potential returns per unit of risk. The Saray Matbaacilik Kagitcilik is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  1,892  in Saray Matbaacilik Kagitcilik on October 10, 2024 and sell it today you would earn a total of  222.00  from holding Saray Matbaacilik Kagitcilik or generate 11.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Eregli Demir ve  vs.  Saray Matbaacilik Kagitcilik

Eregli Demir ve

Risk-Adjusted Performance

1 of 100

Weak

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

Saray Matbaacilik

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Saray Matbaacilik Kagitcilik are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Saray Matbaacilik is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Eregli Demir and Saray Matbaacilik

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

The idea behind Eregli Demir ve and Saray Matbaacilik Kagitcilik 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.