Correlation Between Borlease Otomotiv and IZDEMIR Enerji
Can any of the company-specific risk be diversified away by investing in both Borlease Otomotiv 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 Borlease Otomotiv and IZDEMIR Enerji into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Borlease Otomotiv AS and IZDEMIR Enerji Elektrik, you can compare the effects of market volatilities on Borlease Otomotiv 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 Borlease Otomotiv with a short position of IZDEMIR Enerji. Check out your portfolio center. Please also check ongoing floating volatility patterns of Borlease Otomotiv and IZDEMIR Enerji.
Diversification Opportunities for Borlease Otomotiv and IZDEMIR Enerji
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Borlease and IZDEMIR is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Borlease Otomotiv AS 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 Borlease Otomotiv 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 Borlease Otomotiv AS 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 Borlease Otomotiv i.e., Borlease Otomotiv and IZDEMIR Enerji go up and down completely randomly.
Pair Corralation between Borlease Otomotiv and IZDEMIR Enerji
Assuming the 90 days trading horizon Borlease Otomotiv AS is expected to generate 1.06 times more return on investment than IZDEMIR Enerji. However, Borlease Otomotiv is 1.06 times more volatile than IZDEMIR Enerji Elektrik. It trades about 0.06 of its potential returns per unit of risk. IZDEMIR Enerji Elektrik is currently generating about -0.04 per unit of risk. If you would invest 3,841 in Borlease Otomotiv AS on September 3, 2024 and sell it today you would earn a total of 1,574 from holding Borlease Otomotiv AS or generate 40.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Borlease Otomotiv AS vs. IZDEMIR Enerji Elektrik
Performance |
| Timeline |
| Borlease Otomotiv |
| IZDEMIR Enerji Elektrik |
Borlease Otomotiv and IZDEMIR Enerji Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Borlease Otomotiv and IZDEMIR Enerji
The main advantage of trading using opposite Borlease Otomotiv and IZDEMIR Enerji positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Borlease Otomotiv 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.| Borlease Otomotiv vs. SASA Polyester Sanayi | Borlease Otomotiv vs. Turkish Airlines | Borlease Otomotiv vs. Koc Holding AS | Borlease Otomotiv vs. Ford Otomotiv Sanayi |
| IZDEMIR Enerji vs. SASA Polyester Sanayi | IZDEMIR Enerji vs. Turkish Airlines | IZDEMIR Enerji vs. Koc Holding AS | IZDEMIR Enerji vs. Ford Otomotiv Sanayi |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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