Correlation Between Koc Holding and ODAS Elektrik

Can any of the company-specific risk be diversified away by investing in both Koc Holding 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 Koc Holding and ODAS Elektrik 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 ODAS Elektrik Uretim, you can compare the effects of market volatilities on Koc Holding 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 Koc Holding with a short position of ODAS Elektrik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koc Holding and ODAS Elektrik.

Diversification Opportunities for Koc Holding and ODAS Elektrik

0.76

Correlation Coefficient

Koc Holding  ODAS Elektrik

Poor diversification

The 3 months correlation between Koc and ODAS is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holding AS 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 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 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 Koc Holding i.e., Koc Holding and ODAS Elektrik go up and down completely randomly.

Pair Corralation between Koc Holding and ODAS Elektrik

Assuming the 90 days trading horizon Koc Holding AS is expected to generate 0.81 times more return on investment than ODAS Elektrik. However, Koc Holding AS is 1.23 times less risky than ODAS Elektrik. It trades about 0.0 of its potential returns per unit of risk. ODAS Elektrik Uretim is currently generating about -0.02 per unit of risk. If you would invest  18,510  in Koc Holding AS on September 23, 2024 and sell it today you would lose (310.00) from holding Koc Holding AS or give up 1.67% of portfolio value over 90 days.

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

Koc Holding AS  vs.  ODAS Elektrik Uretim

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.

ODAS Elektrik Uretim

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ODAS Elektrik Uretim has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, ODAS Elektrik is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Koc Holding and ODAS Elektrik

The main advantage of trading using opposite Koc Holding and ODAS Elektrik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koc Holding 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 Koc Holding AS 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.