Correlation Between Bms Birlesik and KOC METALURJI
Can any of the company-specific risk be diversified away by investing in both Bms Birlesik and KOC METALURJI 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 Bms Birlesik and KOC METALURJI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bms Birlesik Metal and KOC METALURJI, you can compare the effects of market volatilities on Bms Birlesik and KOC METALURJI 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 Bms Birlesik with a short position of KOC METALURJI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bms Birlesik and KOC METALURJI.
Diversification Opportunities for Bms Birlesik and KOC METALURJI
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bms and KOC is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bms Birlesik Metal and KOC METALURJI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KOC METALURJI and Bms Birlesik 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 Bms Birlesik Metal are associated (or correlated) with KOC METALURJI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KOC METALURJI has no effect on the direction of Bms Birlesik i.e., Bms Birlesik and KOC METALURJI go up and down completely randomly.
Pair Corralation between Bms Birlesik and KOC METALURJI
Assuming the 90 days trading horizon Bms Birlesik Metal is expected to generate 1.45 times more return on investment than KOC METALURJI. However, Bms Birlesik is 1.45 times more volatile than KOC METALURJI. It trades about -0.04 of its potential returns per unit of risk. KOC METALURJI is currently generating about -0.09 per unit of risk. If you would invest 3,046 in Bms Birlesik Metal on October 25, 2024 and sell it today you would lose (140.00) from holding Bms Birlesik Metal or give up 4.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bms Birlesik Metal vs. KOC METALURJI
Performance |
| Timeline |
| Bms Birlesik Metal |
| KOC METALURJI |
Bms Birlesik and KOC METALURJI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bms Birlesik and KOC METALURJI
The main advantage of trading using opposite Bms Birlesik and KOC METALURJI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bms Birlesik position performs unexpectedly, KOC METALURJI 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 KOC METALURJI will offset losses from the drop in KOC METALURJI's long position.| Bms Birlesik vs. Eregli Demir ve | Bms Birlesik vs. Iskenderun Demir ve | Bms Birlesik vs. Kardemir Karabuk Demir | Bms Birlesik vs. Borusan Mannesmann Boru |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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