Correlation Between Cuhadaroglu Metal and Mackolik Internet

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

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

Diversification Opportunities for Cuhadaroglu Metal and Mackolik Internet

-0.27

Correlation Coefficient

Cuhadaroglu Metal  Mackolik Internet

Very good diversification

The 3 months correlation between Cuhadaroglu and Mackolik is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Cuhadaroglu Metal Sanayi and Mackolik Internet Hizmetleri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mackolik Internet and Cuhadaroglu 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 Cuhadaroglu Metal Sanayi are associated (or correlated) with Mackolik Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mackolik Internet has no effect on the direction of Cuhadaroglu Metal i.e., Cuhadaroglu Metal and Mackolik Internet go up and down completely randomly.

Pair Corralation between Cuhadaroglu Metal and Mackolik Internet

Assuming the 90 days trading horizon Cuhadaroglu Metal Sanayi is expected to under-perform the Mackolik Internet. But the stock apears to be less risky and, when comparing its historical volatility, Cuhadaroglu Metal Sanayi is 1.25 times less risky than Mackolik Internet. The stock trades about -0.05 of its potential returns per unit of risk. The Mackolik Internet Hizmetleri is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  6,783  in Mackolik Internet Hizmetleri on April 4, 2024 and sell it today you would earn a total of  1,817  from holding Mackolik Internet Hizmetleri or generate 26.79% return on investment over 90 days.

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

Cuhadaroglu Metal Sanayi  vs.  Mackolik Internet Hizmetleri

Cuhadaroglu Metal Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cuhadaroglu Metal Sanayi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Mackolik Internet

Risk-Adjusted Performance

11 of 100

Good

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

Pair Trading with Cuhadaroglu Metal and Mackolik Internet

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

The idea behind Cuhadaroglu Metal Sanayi and Mackolik Internet Hizmetleri 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.