Correlation Between Koc Holding and Nasmed Ozel

Can any of the company-specific risk be diversified away by investing in both Koc Holding and Nasmed Ozel 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 Koc Holding and Nasmed Ozel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Koc Holding AS and Nasmed Ozel Saglik, you can compare the effects of market volatilities on Koc Holding and Nasmed Ozel 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 Koc Holding with a short position of Nasmed Ozel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koc Holding and Nasmed Ozel.

Diversification Opportunities for Koc Holding and Nasmed Ozel

0.71

Correlation Coefficient

Koc Holding  Nasmed Ozel

Poor diversification

The 3 months correlation between Koc and Nasmed is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holding AS and Nasmed Ozel Saglik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasmed Ozel Saglik and Koc Holding 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 Koc Holding AS are associated (or correlated) with Nasmed Ozel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasmed Ozel Saglik has no effect on the direction of Koc Holding i.e., Koc Holding and Nasmed Ozel go up and down completely randomly.

Pair Corralation between Koc Holding and Nasmed Ozel

Assuming the 90 days trading horizon Koc Holding AS is expected to generate 0.75 times more return on investment than Nasmed Ozel. However, Koc Holding AS is 1.33 times less risky than Nasmed Ozel. It trades about 0.08 of its potential returns per unit of risk. Nasmed Ozel Saglik is currently generating about 0.04 per unit of risk. If you would invest  7,952  in Koc Holding AS on September 22, 2024 and sell it today you would earn a total of  10,248  from holding Koc Holding AS or generate 128.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.4%
Values	Daily Returns

Koc Holding AS  vs.  Nasmed Ozel Saglik

Koc Holding AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Koc Holding AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Koc Holding is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Nasmed Ozel Saglik

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nasmed Ozel Saglik are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Nasmed Ozel demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Koc Holding and Nasmed Ozel

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

The idea behind Koc Holding AS and Nasmed Ozel Saglik 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.