Correlation Between Koc Holdings and Anadolu Efes

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

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

Diversification Opportunities for Koc Holdings and Anadolu Efes

0.57

Correlation Coefficient

Koc Holdings  Anadolu Efes

Very weak diversification

The 3 months correlation between Koc and Anadolu is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holdings AS and Anadolu Efes Biracilik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anadolu Efes Biracilik and Koc Holdings 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 Holdings AS are associated (or correlated) with Anadolu Efes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anadolu Efes Biracilik has no effect on the direction of Koc Holdings i.e., Koc Holdings and Anadolu Efes go up and down completely randomly.

Pair Corralation between Koc Holdings and Anadolu Efes

Assuming the 90 days horizon Koc Holdings AS is expected to generate 0.79 times more return on investment than Anadolu Efes. However, Koc Holdings AS is 1.26 times less risky than Anadolu Efes. It trades about 0.08 of its potential returns per unit of risk. Anadolu Efes Biracilik is currently generating about 0.03 per unit of risk. If you would invest  2,530  in Koc Holdings AS on September 14, 2024 and sell it today you would earn a total of  276.00  from holding Koc Holdings AS or generate 10.91% return on investment over 90 days.

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

Koc Holdings AS  vs.  Anadolu Efes Biracilik

Koc Holdings AS

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Koc Holdings AS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak essential indicators, Koc Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Anadolu Efes Biracilik

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Anadolu Efes Biracilik are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Anadolu Efes may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Koc Holdings and Anadolu Efes

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

The idea behind Koc Holdings AS and Anadolu Efes Biracilik 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.