Correlation Between Politeknik Metal and Flap Kongre

Can any of the company-specific risk be diversified away by investing in both Politeknik Metal and Flap Kongre 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 Politeknik Metal and Flap Kongre into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Politeknik Metal and Flap Kongre

-0.22

Correlation Coefficient

Politeknik Metal  Flap Kongre

Very good diversification

The 3 months correlation between Politeknik and Flap is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Politeknik Metal Sanayi and Flap Kongre Toplanti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flap Kongre Toplanti and Politeknik Metal 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 Politeknik Metal Sanayi are associated (or correlated) with Flap Kongre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flap Kongre Toplanti has no effect on the direction of Politeknik Metal i.e., Politeknik Metal and Flap Kongre go up and down completely randomly.

Pair Corralation between Politeknik Metal and Flap Kongre

Assuming the 90 days trading horizon Politeknik Metal Sanayi is expected to generate 0.81 times more return on investment than Flap Kongre. However, Politeknik Metal Sanayi is 1.24 times less risky than Flap Kongre. It trades about 0.03 of its potential returns per unit of risk. Flap Kongre Toplanti is currently generating about -0.16 per unit of risk. If you would invest  694,500  in Politeknik Metal Sanayi on September 22, 2024 and sell it today you would earn a total of  15,000  from holding Politeknik Metal Sanayi or generate 2.16% return on investment over 90 days.

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

Politeknik Metal Sanayi  vs.  Flap Kongre Toplanti

Politeknik Metal Sanayi

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Politeknik Metal Sanayi are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Politeknik Metal is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Flap Kongre Toplanti

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Flap Kongre Toplanti has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Politeknik Metal and Flap Kongre

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

The idea behind Politeknik Metal Sanayi and Flap Kongre Toplanti 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.