Correlation Between Cimsa Cimento and Aksa Akrilik

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

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

Diversification Opportunities for Cimsa Cimento and Aksa Akrilik

0.83

Correlation Coefficient

Cimsa Cimento  Aksa Akrilik

Very poor diversification

The 3 months correlation between Cimsa and Aksa is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Cimsa Cimento Sanayi and Aksa Akrilik Kimya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aksa Akrilik Kimya and Cimsa Cimento 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 Cimsa Cimento Sanayi are associated (or correlated) with Aksa Akrilik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aksa Akrilik Kimya has no effect on the direction of Cimsa Cimento i.e., Cimsa Cimento and Aksa Akrilik go up and down completely randomly.

Pair Corralation between Cimsa Cimento and Aksa Akrilik

Assuming the 90 days trading horizon Cimsa Cimento is expected to generate 1.51 times less return on investment than Aksa Akrilik. But when comparing it to its historical volatility, Cimsa Cimento Sanayi is 1.68 times less risky than Aksa Akrilik. It trades about 0.05 of its potential returns per unit of risk. Aksa Akrilik Kimya is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  702.00  in Aksa Akrilik Kimya on September 23, 2024 and sell it today you would earn a total of  439.00  from holding Aksa Akrilik Kimya or generate 62.54% return on investment over 90 days.

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

Cimsa Cimento Sanayi  vs.  Aksa Akrilik Kimya

Cimsa Cimento Sanayi

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cimsa Cimento Sanayi are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Cimsa Cimento demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Aksa Akrilik Kimya

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aksa Akrilik Kimya are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Aksa Akrilik unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cimsa Cimento and Aksa Akrilik

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

The idea behind Cimsa Cimento Sanayi and Aksa Akrilik Kimya 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.