Correlation Between Makina Takim and Ozerden Plastik

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Can any of the company-specific risk be diversified away by investing in both Makina Takim and Ozerden Plastik 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 Makina Takim and Ozerden Plastik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Makina Takim Endustrisi and Ozerden Plastik Sanayi, you can compare the effects of market volatilities on Makina Takim and Ozerden Plastik 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 Makina Takim with a short position of Ozerden Plastik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Makina Takim and Ozerden Plastik.

Diversification Opportunities for Makina Takim and Ozerden Plastik

MakinaOzerdenDiversified AwayMakinaOzerdenDiversified Away100%
0.68
  Correlation Coefficient

Poor diversification

The 3 months correlation between Makina and Ozerden is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Makina Takim Endustrisi and Ozerden Plastik Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ozerden Plastik Sanayi and Makina Takim 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 Makina Takim Endustrisi are associated (or correlated) with Ozerden Plastik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ozerden Plastik Sanayi has no effect on the direction of Makina Takim i.e., Makina Takim and Ozerden Plastik go up and down completely randomly.

Pair Corralation between Makina Takim and Ozerden Plastik

Assuming the 90 days trading horizon Makina Takim Endustrisi is expected to generate 1.08 times more return on investment than Ozerden Plastik. However, Makina Takim is 1.08 times more volatile than Ozerden Plastik Sanayi. It trades about 0.11 of its potential returns per unit of risk. Ozerden Plastik Sanayi is currently generating about 0.11 per unit of risk. If you would invest  613.00  in Makina Takim Endustrisi on October 9, 2024 and sell it today you would earn a total of  106.00  from holding Makina Takim Endustrisi or generate 17.29% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy98.41%
ValuesDaily Returns

Makina Takim Endustrisi  vs.  Ozerden Plastik Sanayi

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -20-1001020
JavaScript chart by amCharts 3.21.15MAKTK OZRDN
       Timeline  
Makina Takim Endustrisi 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Makina Takim Endustrisi are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Makina Takim demonstrated solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan66.577.5
Ozerden Plastik Sanayi 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
OK
Over the last 90 days Ozerden Plastik Sanayi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly weak forward indicators, Ozerden Plastik demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Makina Takim and Ozerden Plastik Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-8.2-6.14-4.08-2.020.02.074.256.448.6210.8 0.020.030.040.050.06
JavaScript chart by amCharts 3.21.15MAKTK OZRDN
       Returns  

Pair Trading with Makina Takim and Ozerden Plastik

The main advantage of trading using opposite Makina Takim and Ozerden Plastik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Makina Takim position performs unexpectedly, Ozerden Plastik 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 Ozerden Plastik will offset losses from the drop in Ozerden Plastik's long position.
The idea behind Makina Takim Endustrisi and Ozerden Plastik 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

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