Correlation Between Koc Holding and CEO Event

Can any of the company-specific risk be diversified away by investing in both Koc Holding and CEO Event 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 Koc Holding and CEO Event into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Koc Holding AS and CEO Event Medya, you can compare the effects of market volatilities on Koc Holding and CEO Event 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 Koc Holding with a short position of CEO Event. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koc Holding and CEO Event.

Diversification Opportunities for Koc Holding and CEO Event

-0.82

Correlation Coefficient

Koc Holding  CEO Event

Pay attention - limited upside

The 3 months correlation between Koc and CEO is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holding AS and CEO Event Medya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEO Event Medya and Koc Holding 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 Koc Holding AS are associated (or correlated) with CEO Event. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEO Event Medya has no effect on the direction of Koc Holding i.e., Koc Holding and CEO Event go up and down completely randomly.

Pair Corralation between Koc Holding and CEO Event

Assuming the 90 days trading horizon Koc Holding AS is expected to generate 0.43 times more return on investment than CEO Event. However, Koc Holding AS is 2.31 times less risky than CEO Event. It trades about 0.09 of its potential returns per unit of risk. CEO Event Medya is currently generating about -0.16 per unit of risk. If you would invest  17,520  in Koc Holding AS on September 13, 2024 and sell it today you would earn a total of  2,000  from holding Koc Holding AS or generate 11.42% return on investment over 90 days.

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

Koc Holding AS  vs.  CEO Event Medya

Koc Holding AS

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Koc Holding AS are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Koc Holding may actually be approaching a critical reversion point that can send shares even higher in January 2025.

CEO Event Medya

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CEO Event Medya 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 January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Koc Holding and CEO Event

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

The idea behind Koc Holding AS and CEO Event Medya 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.