Correlation Between KOC METALURJI and Nigbas Nigde

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

By analyzing existing cross correlation between KOC METALURJI and Nigbas Nigde Beton, you can compare the effects of market volatilities on KOC METALURJI and Nigbas Nigde 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 Nigbas Nigde. Check out your portfolio center. Please also check ongoing floating volatility patterns of KOC METALURJI and Nigbas Nigde.

Diversification Opportunities for KOC METALURJI and Nigbas Nigde

0.52

Correlation Coefficient

KOC METALURJI  Nigbas Nigde

Very weak diversification

The 3 months correlation between KOC and Nigbas is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding KOC METALURJI and Nigbas Nigde Beton in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nigbas Nigde Beton 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 Nigbas Nigde. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nigbas Nigde Beton has no effect on the direction of KOC METALURJI i.e., KOC METALURJI and Nigbas Nigde go up and down completely randomly.

Pair Corralation between KOC METALURJI and Nigbas Nigde

Assuming the 90 days trading horizon KOC METALURJI is expected to generate 1.44 times more return on investment than Nigbas Nigde. However, KOC METALURJI is 1.44 times more volatile than Nigbas Nigde Beton. It trades about -0.12 of its potential returns per unit of risk. Nigbas Nigde Beton is currently generating about -0.22 per unit of risk. If you would invest  1,610  in KOC METALURJI on December 21, 2024 and sell it today you would lose (360.00) from holding KOC METALURJI or give up 22.36% of portfolio value over 90 days.

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

KOC METALURJI  vs.  Nigbas Nigde Beton

KOC METALURJI

Risk-Adjusted Performance

Very Weak

Over the last 90 days KOC METALURJI 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 April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Nigbas Nigde Beton

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nigbas Nigde Beton 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 April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with KOC METALURJI and Nigbas Nigde

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

The idea behind KOC METALURJI and Nigbas Nigde Beton 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.