Correlation Between Luks Kadife and NYSE Composite
Can any of the company-specific risk be diversified away by investing in both Luks Kadife and NYSE Composite 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 Luks Kadife and NYSE Composite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luks Kadife Ticaret and NYSE Composite, you can compare the effects of market volatilities on Luks Kadife and NYSE Composite 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 Luks Kadife with a short position of NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luks Kadife and NYSE Composite.
Diversification Opportunities for Luks Kadife and NYSE Composite
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Luks and NYSE is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Luks Kadife Ticaret and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Luks Kadife 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 Luks Kadife Ticaret are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Luks Kadife i.e., Luks Kadife and NYSE Composite go up and down completely randomly.
Pair Corralation between Luks Kadife and NYSE Composite
Assuming the 90 days trading horizon Luks Kadife Ticaret is expected to generate 6.81 times more return on investment than NYSE Composite. However, Luks Kadife is 6.81 times more volatile than NYSE Composite. It trades about 0.36 of its potential returns per unit of risk. NYSE Composite is currently generating about -0.18 per unit of risk. If you would invest 9,880 in Luks Kadife Ticaret on January 30, 2024 and sell it today you would earn a total of 2,900 from holding Luks Kadife Ticaret or generate 29.35% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 80.95% |
Values | Daily Returns |
Luks Kadife Ticaret vs. NYSE Composite
Performance |
Timeline |
Luks Kadife and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
Luks Kadife Ticaret
Pair trading matchups for Luks Kadife
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Luks Kadife and NYSE Composite
The main advantage of trading using opposite Luks Kadife and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luks Kadife position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.Luks Kadife vs. Koc Holding AS | Luks Kadife vs. Turkish Airlines | Luks Kadife vs. Turkiye Garanti Bankasi | Luks Kadife vs. Turkiye Petrol Rafinerileri |
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Check out your portfolio center.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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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