Correlation Between Brisa Bridgestone and Gentas Genel
Can any of the company-specific risk be diversified away by investing in both Brisa Bridgestone and Gentas Genel 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 Gentas Genel 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 Gentas Genel Metal, you can compare the effects of market volatilities on Brisa Bridgestone and Gentas Genel 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 Gentas Genel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brisa Bridgestone and Gentas Genel.
Diversification Opportunities for Brisa Bridgestone and Gentas Genel
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Brisa and Gentas is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Brisa Bridgestone Sabanci and Gentas Genel Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentas Genel Metal 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 Gentas Genel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentas Genel Metal has no effect on the direction of Brisa Bridgestone i.e., Brisa Bridgestone and Gentas Genel go up and down completely randomly.
Pair Corralation between Brisa Bridgestone and Gentas Genel
Assuming the 90 days trading horizon Brisa Bridgestone Sabanci is expected to generate 1.24 times more return on investment than Gentas Genel. However, Brisa Bridgestone is 1.24 times more volatile than Gentas Genel Metal. It trades about 0.25 of its potential returns per unit of risk. Gentas Genel Metal is currently generating about 0.26 per unit of risk. If you would invest 8,410 in Brisa Bridgestone Sabanci on August 29, 2024 and sell it today you would earn a total of 1,275 from holding Brisa Bridgestone Sabanci or generate 15.16% 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. Gentas Genel Metal
Performance |
| Timeline |
| Brisa Bridgestone Sabanci |
| Gentas Genel Metal |
Brisa Bridgestone and Gentas Genel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brisa Bridgestone and Gentas Genel
The main advantage of trading using opposite Brisa Bridgestone and Gentas Genel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brisa Bridgestone position performs unexpectedly, Gentas Genel 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 Gentas Genel will offset losses from the drop in Gentas Genel's long position.| Brisa Bridgestone vs. Aksa Akrilik Kimya | Brisa Bridgestone vs. Kordsa Global Endustriyel | Brisa Bridgestone vs. Tofas Turk Otomobil | Brisa Bridgestone vs. Arcelik AS |
| Gentas Genel vs. Haci Omer Sabanci | Gentas Genel vs. Turkiye Sise ve | Gentas Genel vs. Turkiye Petrol Rafinerileri | Gentas Genel vs. Turkiye Garanti 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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