Correlation Between MEGA METAL and Kuyas Yatirim

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

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

Diversification Opportunities for MEGA METAL and Kuyas Yatirim

-0.82

Correlation Coefficient

MEGA METAL  Kuyas Yatirim

Pay attention - limited upside

The 3 months correlation between MEGA and Kuyas is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding MEGA METAL and Kuyas Yatirim AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuyas Yatirim AS and MEGA METAL 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 MEGA METAL are associated (or correlated) with Kuyas Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuyas Yatirim AS has no effect on the direction of MEGA METAL i.e., MEGA METAL and Kuyas Yatirim go up and down completely randomly.

Pair Corralation between MEGA METAL and Kuyas Yatirim

Assuming the 90 days trading horizon MEGA METAL is expected to under-perform the Kuyas Yatirim. But the stock apears to be less risky and, when comparing its historical volatility, MEGA METAL is 1.42 times less risky than Kuyas Yatirim. The stock trades about -0.21 of its potential returns per unit of risk. The Kuyas Yatirim AS is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  1,722  in Kuyas Yatirim AS on December 3, 2024 and sell it today you would earn a total of  682.00  from holding Kuyas Yatirim AS or generate 39.61% return on investment over 90 days.

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

MEGA METAL  vs.  Kuyas Yatirim AS

MEGA METAL

Risk-Adjusted Performance

Very Weak

Over the last 90 days MEGA METAL 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.

Kuyas Yatirim AS

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kuyas Yatirim AS are ranked lower than 16 (%) 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.

Pair Trading with MEGA METAL and Kuyas Yatirim

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

The idea behind MEGA METAL and Kuyas Yatirim AS 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 Transaction History module to view history of all your transactions and understand their impact on performance.