Correlation Between Brisa Bridgestone and Birlik Mensucat
Can any of the company-specific risk be diversified away by investing in both Brisa Bridgestone and Birlik Mensucat 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 Brisa Bridgestone and Birlik Mensucat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brisa Bridgestone Sabanci and Birlik Mensucat Ticaret, you can compare the effects of market volatilities on Brisa Bridgestone and Birlik Mensucat 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 Brisa Bridgestone with a short position of Birlik Mensucat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brisa Bridgestone and Birlik Mensucat.
Diversification Opportunities for Brisa Bridgestone and Birlik Mensucat
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Brisa and Birlik is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Brisa Bridgestone Sabanci and Birlik Mensucat Ticaret in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Birlik Mensucat Ticaret and Brisa Bridgestone 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 Brisa Bridgestone Sabanci are associated (or correlated) with Birlik Mensucat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Birlik Mensucat Ticaret has no effect on the direction of Brisa Bridgestone i.e., Brisa Bridgestone and Birlik Mensucat go up and down completely randomly.
Pair Corralation between Brisa Bridgestone and Birlik Mensucat
Assuming the 90 days trading horizon Brisa Bridgestone is expected to generate 2.08 times less return on investment than Birlik Mensucat. But when comparing it to its historical volatility, Brisa Bridgestone Sabanci is 1.67 times less risky than Birlik Mensucat. It trades about 0.03 of its potential returns per unit of risk. Birlik Mensucat Ticaret is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 529.00 in Birlik Mensucat Ticaret on August 26, 2024 and sell it today you would earn a total of 89.00 from holding Birlik Mensucat Ticaret or generate 16.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brisa Bridgestone Sabanci vs. Birlik Mensucat Ticaret
Performance |
| Timeline |
| Brisa Bridgestone Sabanci |
| Birlik Mensucat Ticaret |
Brisa Bridgestone and Birlik Mensucat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brisa Bridgestone and Birlik Mensucat
The main advantage of trading using opposite Brisa Bridgestone and Birlik Mensucat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brisa Bridgestone position performs unexpectedly, Birlik Mensucat 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 Birlik Mensucat will offset losses from the drop in Birlik Mensucat's long position.| Brisa Bridgestone vs. Qnb Finansbank AS | Brisa Bridgestone vs. Kent Gida Maddeleri | Brisa Bridgestone vs. QNB Finans Finansal | Brisa Bridgestone vs. Turkiye Kalkinma Bankasi |
| Birlik Mensucat vs. Qnb Finansbank AS | Birlik Mensucat vs. Kent Gida Maddeleri | Birlik Mensucat vs. QNB Finans Finansal | Birlik Mensucat vs. Turkiye Kalkinma Bankasi |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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