Correlation Between Haci Omer and Eminis Ambalaj

Can any of the company-specific risk be diversified away by investing in both Haci Omer and Eminis Ambalaj 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 Haci Omer and Eminis Ambalaj into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Haci Omer Sabanci and Eminis Ambalaj Sanayi, you can compare the effects of market volatilities on Haci Omer and Eminis Ambalaj 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 Haci Omer with a short position of Eminis Ambalaj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haci Omer and Eminis Ambalaj.

Diversification Opportunities for Haci Omer and Eminis Ambalaj

0.94

Correlation Coefficient

Haci Omer  Eminis Ambalaj

Almost no diversification

The 3 months correlation between Haci and Eminis is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Haci Omer Sabanci and Eminis Ambalaj Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eminis Ambalaj Sanayi and Haci Omer 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 Haci Omer Sabanci are associated (or correlated) with Eminis Ambalaj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eminis Ambalaj Sanayi has no effect on the direction of Haci Omer i.e., Haci Omer and Eminis Ambalaj go up and down completely randomly.

Pair Corralation between Haci Omer and Eminis Ambalaj

Assuming the 90 days trading horizon Haci Omer Sabanci is expected to generate 0.29 times more return on investment than Eminis Ambalaj. However, Haci Omer Sabanci is 3.46 times less risky than Eminis Ambalaj. It trades about -0.34 of its potential returns per unit of risk. Eminis Ambalaj Sanayi is currently generating about -0.25 per unit of risk. If you would invest  10,640  in Haci Omer Sabanci on March 22, 2024 and sell it today you would lose (1,255) from holding Haci Omer Sabanci or give up 11.8% of portfolio value over 90 days.

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

Haci Omer Sabanci  vs.  Eminis Ambalaj Sanayi

Haci Omer Sabanci

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Haci Omer Sabanci are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent essential indicators, Haci Omer demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Eminis Ambalaj Sanayi

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eminis Ambalaj Sanayi are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Eminis Ambalaj demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Haci Omer and Eminis Ambalaj

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

The idea behind Haci Omer Sabanci and Eminis Ambalaj Sanayi 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.