Correlation Between Lokman Hekim and Nuh Cimento

Can any of the company-specific risk be diversified away by investing in both Lokman Hekim and Nuh Cimento 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 Lokman Hekim and Nuh Cimento into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lokman Hekim Engurusag and Nuh Cimento Sanayi, you can compare the effects of market volatilities on Lokman Hekim and Nuh Cimento 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 Lokman Hekim with a short position of Nuh Cimento. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lokman Hekim and Nuh Cimento.

Diversification Opportunities for Lokman Hekim and Nuh Cimento

-0.07

Correlation Coefficient

Lokman Hekim  Nuh Cimento

Good diversification

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

Pair Corralation between Lokman Hekim and Nuh Cimento

Assuming the 90 days trading horizon Lokman Hekim Engurusag is expected to generate 0.93 times more return on investment than Nuh Cimento. However, Lokman Hekim Engurusag is 1.08 times less risky than Nuh Cimento. It trades about 0.01 of its potential returns per unit of risk. Nuh Cimento Sanayi is currently generating about -0.05 per unit of risk. If you would invest  1,816  in Lokman Hekim Engurusag on December 28, 2024 and sell it today you would earn a total of  4.00  from holding Lokman Hekim Engurusag or generate 0.22% return on investment over 90 days.

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

Lokman Hekim Engurusag  vs.  Nuh Cimento Sanayi

Lokman Hekim Engurusag

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lokman Hekim Engurusag are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Lokman Hekim is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Nuh Cimento Sanayi

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nuh Cimento Sanayi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Lokman Hekim and Nuh Cimento

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

The idea behind Lokman Hekim Engurusag and Nuh Cimento 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.

Check out your portfolio center.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.