Correlation Between Nuh Cimento and Koza Anadolu

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

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

Diversification Opportunities for Nuh Cimento and Koza Anadolu

0.76

Correlation Coefficient

Nuh Cimento  Koza Anadolu

Poor diversification

The 3 months correlation between Nuh and Koza is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Nuh Cimento Sanayi and Koza Anadolu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koza Anadolu Metal and Nuh 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 Nuh Cimento Sanayi are associated (or correlated) with Koza Anadolu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koza Anadolu Metal has no effect on the direction of Nuh Cimento i.e., Nuh Cimento and Koza Anadolu go up and down completely randomly.

Pair Corralation between Nuh Cimento and Koza Anadolu

Assuming the 90 days trading horizon Nuh Cimento Sanayi is expected to generate 1.11 times more return on investment than Koza Anadolu. However, Nuh Cimento is 1.11 times more volatile than Koza Anadolu Metal. It trades about 0.07 of its potential returns per unit of risk. Koza Anadolu Metal is currently generating about 0.03 per unit of risk. If you would invest  10,517  in Nuh Cimento Sanayi on September 26, 2024 and sell it today you would earn a total of  19,458  from holding Nuh Cimento Sanayi or generate 185.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

Nuh Cimento Sanayi  vs.  Koza Anadolu Metal

Nuh Cimento Sanayi

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nuh Cimento Sanayi are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Nuh Cimento demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Koza Anadolu Metal

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Nuh Cimento and Koza Anadolu

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

The idea behind Nuh Cimento Sanayi and Koza Anadolu Metal 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 Commodity Directory module to find actively traded commodities issued by global exchanges.