Correlation Between X Financial and ODAS Elektrik

Can any of the company-specific risk be diversified away by investing in both X Financial and ODAS Elektrik 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 X Financial and ODAS Elektrik into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between X Financial Class and ODAS Elektrik Uretim, you can compare the effects of market volatilities on X Financial and ODAS Elektrik 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 X Financial with a short position of ODAS Elektrik. Check out your portfolio center. Please also check ongoing floating volatility patterns of X Financial and ODAS Elektrik.

Diversification Opportunities for X Financial and ODAS Elektrik

0.35

Correlation Coefficient

X Financial  ODAS Elektrik

Weak diversification

The 3 months correlation between XYF and ODAS is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding X Financial Class and ODAS Elektrik Uretim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ODAS Elektrik Uretim and X Financial 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 X Financial Class are associated (or correlated) with ODAS Elektrik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ODAS Elektrik Uretim has no effect on the direction of X Financial i.e., X Financial and ODAS Elektrik go up and down completely randomly.

Pair Corralation between X Financial and ODAS Elektrik

Considering the 90-day investment horizon X Financial Class is expected to generate 2.14 times more return on investment than ODAS Elektrik. However, X Financial is 2.14 times more volatile than ODAS Elektrik Uretim. It trades about 0.21 of its potential returns per unit of risk. ODAS Elektrik Uretim is currently generating about -0.04 per unit of risk. If you would invest  710.00  in X Financial Class on October 4, 2024 and sell it today you would earn a total of  131.00  from holding X Financial Class or generate 18.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

X Financial Class  vs.  ODAS Elektrik Uretim

X Financial Class

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in X Financial Class are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, X Financial reported solid returns over the last few months and may actually be approaching a breakup point.

ODAS Elektrik Uretim

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ODAS Elektrik Uretim are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, ODAS Elektrik may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with X Financial and ODAS Elektrik

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

The idea behind X Financial Class and ODAS Elektrik Uretim 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.