Correlation Between KOC METALURJI and Ekiz Kimya

Can any of the company-specific risk be diversified away by investing in both KOC METALURJI and Ekiz Kimya 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 METALURJI and Ekiz Kimya into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KOC METALURJI and Ekiz Kimya Sanayi, you can compare the effects of market volatilities on KOC METALURJI and Ekiz Kimya 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 METALURJI with a short position of Ekiz Kimya. Check out your portfolio center. Please also check ongoing floating volatility patterns of KOC METALURJI and Ekiz Kimya.

Diversification Opportunities for KOC METALURJI and Ekiz Kimya

0.24

Correlation Coefficient

KOC METALURJI  Ekiz Kimya

Modest diversification

The 3 months correlation between KOC and Ekiz is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding KOC METALURJI and Ekiz Kimya Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekiz Kimya Sanayi and KOC METALURJI 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 METALURJI are associated (or correlated) with Ekiz Kimya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekiz Kimya Sanayi has no effect on the direction of KOC METALURJI i.e., KOC METALURJI and Ekiz Kimya go up and down completely randomly.

Pair Corralation between KOC METALURJI and Ekiz Kimya

Assuming the 90 days trading horizon KOC METALURJI is expected to under-perform the Ekiz Kimya. In addition to that, KOC METALURJI is 1.51 times more volatile than Ekiz Kimya Sanayi. It trades about -0.1 of its total potential returns per unit of risk. Ekiz Kimya Sanayi is currently generating about -0.16 per unit of volatility. If you would invest  5,990  in Ekiz Kimya Sanayi on October 11, 2024 and sell it today you would lose (340.00) from holding Ekiz Kimya Sanayi or give up 5.68% of portfolio value over 90 days.

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

KOC METALURJI  vs.  Ekiz Kimya Sanayi

KOC METALURJI

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in KOC METALURJI are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, KOC METALURJI demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Ekiz Kimya Sanayi

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ekiz Kimya Sanayi are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Ekiz Kimya is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with KOC METALURJI and Ekiz Kimya

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

The idea behind KOC METALURJI and Ekiz Kimya Sanayi 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.