Correlation Between Koc Holding and Iskenderun Demir

Can any of the company-specific risk be diversified away by investing in both Koc Holding and Iskenderun Demir 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 Iskenderun Demir 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 Iskenderun Demir ve, you can compare the effects of market volatilities on Koc Holding and Iskenderun Demir 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 Iskenderun Demir. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koc Holding and Iskenderun Demir.

Diversification Opportunities for Koc Holding and Iskenderun Demir

-0.26

Correlation Coefficient

Koc Holding  Iskenderun Demir

Very good diversification

The 3 months correlation between Koc and Iskenderun is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holding AS and Iskenderun Demir ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iskenderun Demir 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 Iskenderun Demir. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iskenderun Demir has no effect on the direction of Koc Holding i.e., Koc Holding and Iskenderun Demir go up and down completely randomly.

Pair Corralation between Koc Holding and Iskenderun Demir

Assuming the 90 days trading horizon Koc Holding AS is expected to generate 0.75 times more return on investment than Iskenderun Demir. However, Koc Holding AS is 1.34 times less risky than Iskenderun Demir. It trades about 0.52 of its potential returns per unit of risk. Iskenderun Demir ve is currently generating about 0.21 per unit of risk. If you would invest  20,800  in Koc Holding AS on February 21, 2024 and sell it today you would earn a total of  3,780  from holding Koc Holding AS or generate 18.17% return on investment over 90 days.

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

Koc Holding AS  vs.  Iskenderun Demir ve

Koc Holding AS

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Koc Holding AS are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent essential indicators, Koc Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Iskenderun Demir

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Koc Holding and Iskenderun Demir

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

The idea behind Koc Holding AS and Iskenderun Demir ve 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.