Correlation Between Kuyas Yatirim and Ege Endustri

Can any of the company-specific risk be diversified away by investing in both Kuyas Yatirim and Ege Endustri 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 Kuyas Yatirim and Ege Endustri into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kuyas Yatirim AS and Ege Endustri ve, you can compare the effects of market volatilities on Kuyas Yatirim and Ege Endustri 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 Kuyas Yatirim with a short position of Ege Endustri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuyas Yatirim and Ege Endustri.

Diversification Opportunities for Kuyas Yatirim and Ege Endustri

0.07

Correlation Coefficient

Kuyas Yatirim  Ege Endustri

Significant diversification

The 3 months correlation between Kuyas and Ege is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kuyas Yatirim AS and Ege Endustri ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ege Endustri ve and Kuyas Yatirim 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 Kuyas Yatirim AS are associated (or correlated) with Ege Endustri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ege Endustri ve has no effect on the direction of Kuyas Yatirim i.e., Kuyas Yatirim and Ege Endustri go up and down completely randomly.

Pair Corralation between Kuyas Yatirim and Ege Endustri

Assuming the 90 days trading horizon Kuyas Yatirim AS is expected to generate 2.75 times more return on investment than Ege Endustri. However, Kuyas Yatirim is 2.75 times more volatile than Ege Endustri ve. It trades about 0.28 of its potential returns per unit of risk. Ege Endustri ve is currently generating about -0.32 per unit of risk. If you would invest  1,690  in Kuyas Yatirim AS on October 9, 2024 and sell it today you would earn a total of  360.00  from holding Kuyas Yatirim AS or generate 21.3% return on investment over 90 days.

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

Kuyas Yatirim AS  vs.  Ege Endustri ve

Kuyas Yatirim AS

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kuyas Yatirim AS are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Kuyas Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Ege Endustri ve

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ege Endustri ve are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Ege Endustri is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Kuyas Yatirim and Ege Endustri

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

The idea behind Kuyas Yatirim AS and Ege Endustri ve 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.