Correlation Between Akbank TAS and IZDEMIR Enerji
Can any of the company-specific risk be diversified away by investing in both Akbank TAS and IZDEMIR Enerji 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 Akbank TAS and IZDEMIR Enerji into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akbank TAS and IZDEMIR Enerji Elektrik, you can compare the effects of market volatilities on Akbank TAS and IZDEMIR Enerji 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 Akbank TAS with a short position of IZDEMIR Enerji. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akbank TAS and IZDEMIR Enerji.
Diversification Opportunities for Akbank TAS and IZDEMIR Enerji
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Akbank and IZDEMIR is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Akbank TAS and IZDEMIR Enerji Elektrik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IZDEMIR Enerji Elektrik and Akbank TAS 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 Akbank TAS are associated (or correlated) with IZDEMIR Enerji. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IZDEMIR Enerji Elektrik has no effect on the direction of Akbank TAS i.e., Akbank TAS and IZDEMIR Enerji go up and down completely randomly.
Pair Corralation between Akbank TAS and IZDEMIR Enerji
Assuming the 90 days trading horizon Akbank TAS is expected to generate 1.11 times more return on investment than IZDEMIR Enerji. However, Akbank TAS is 1.11 times more volatile than IZDEMIR Enerji Elektrik. It trades about 0.23 of its potential returns per unit of risk. IZDEMIR Enerji Elektrik is currently generating about -0.09 per unit of risk. If you would invest 5,100 in Akbank TAS on August 31, 2024 and sell it today you would earn a total of 870.00 from holding Akbank TAS or generate 17.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akbank TAS vs. IZDEMIR Enerji Elektrik
Performance |
| Timeline |
| Akbank TAS |
| IZDEMIR Enerji Elektrik |
Akbank TAS and IZDEMIR Enerji Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akbank TAS and IZDEMIR Enerji
The main advantage of trading using opposite Akbank TAS and IZDEMIR Enerji positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akbank TAS position performs unexpectedly, IZDEMIR Enerji 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 IZDEMIR Enerji will offset losses from the drop in IZDEMIR Enerji's long position.The idea behind Akbank TAS and IZDEMIR Enerji Elektrik 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.| IZDEMIR Enerji vs. ICBC Turkey Bank | IZDEMIR Enerji vs. Bms Birlesik Metal | IZDEMIR Enerji vs. Cuhadaroglu Metal Sanayi | IZDEMIR Enerji vs. Akbank TAS |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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