Correlation Between Koza Anadolu and Kalekim Kimyevi

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

By analyzing existing cross correlation between Koza Anadolu Metal and Kalekim Kimyevi Maddeler, you can compare the effects of market volatilities on Koza Anadolu and Kalekim Kimyevi 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 Koza Anadolu with a short position of Kalekim Kimyevi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koza Anadolu and Kalekim Kimyevi.

Diversification Opportunities for Koza Anadolu and Kalekim Kimyevi

0.47

Correlation Coefficient

Koza Anadolu  Kalekim Kimyevi

Very weak diversification

The 3 months correlation between Koza and Kalekim is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Koza Anadolu Metal and Kalekim Kimyevi Maddeler in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kalekim Kimyevi Maddeler and Koza Anadolu 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 Koza Anadolu Metal are associated (or correlated) with Kalekim Kimyevi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kalekim Kimyevi Maddeler has no effect on the direction of Koza Anadolu i.e., Koza Anadolu and Kalekim Kimyevi go up and down completely randomly.

Pair Corralation between Koza Anadolu and Kalekim Kimyevi

Assuming the 90 days trading horizon Koza Anadolu is expected to generate 2.12 times less return on investment than Kalekim Kimyevi. But when comparing it to its historical volatility, Koza Anadolu Metal is 1.06 times less risky than Kalekim Kimyevi. It trades about 0.12 of its potential returns per unit of risk. Kalekim Kimyevi Maddeler is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  3,000  in Kalekim Kimyevi Maddeler on October 20, 2024 and sell it today you would earn a total of  390.00  from holding Kalekim Kimyevi Maddeler or generate 13.0% return on investment over 90 days.

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

Koza Anadolu Metal  vs.  Kalekim Kimyevi Maddeler

Koza Anadolu Metal

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Koza Anadolu Metal are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Koza Anadolu demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Kalekim Kimyevi Maddeler

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kalekim Kimyevi Maddeler are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Kalekim Kimyevi demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Koza Anadolu and Kalekim Kimyevi

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

The idea behind Koza Anadolu Metal and Kalekim Kimyevi Maddeler 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.