Correlation Between Eregli Demir and Qnb Finansbank
Can any of the company-specific risk be diversified away by investing in both Eregli Demir and Qnb Finansbank 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 Eregli Demir and Qnb Finansbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eregli Demir ve and Qnb Finansbank AS, you can compare the effects of market volatilities on Eregli Demir and Qnb Finansbank 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 Eregli Demir with a short position of Qnb Finansbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eregli Demir and Qnb Finansbank.
Diversification Opportunities for Eregli Demir and Qnb Finansbank
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eregli and Qnb is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Eregli Demir ve and Qnb Finansbank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qnb Finansbank AS and Eregli Demir 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 Eregli Demir ve are associated (or correlated) with Qnb Finansbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qnb Finansbank AS has no effect on the direction of Eregli Demir i.e., Eregli Demir and Qnb Finansbank go up and down completely randomly.
Pair Corralation between Eregli Demir and Qnb Finansbank
Assuming the 90 days trading horizon Eregli Demir is expected to generate 6.35 times less return on investment than Qnb Finansbank. But when comparing it to its historical volatility, Eregli Demir ve is 2.35 times less risky than Qnb Finansbank. It trades about 0.05 of its potential returns per unit of risk. Qnb Finansbank AS is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 4,410 in Qnb Finansbank AS on August 28, 2024 and sell it today you would earn a total of 24,065 from holding Qnb Finansbank AS or generate 545.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Eregli Demir ve vs. Qnb Finansbank AS
Performance |
| Timeline |
| Eregli Demir ve |
| Qnb Finansbank AS |
Eregli Demir and Qnb Finansbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eregli Demir and Qnb Finansbank
The main advantage of trading using opposite Eregli Demir and Qnb Finansbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eregli Demir position performs unexpectedly, Qnb Finansbank 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 Qnb Finansbank will offset losses from the drop in Qnb Finansbank's long position.| Eregli Demir vs. Qnb Finansbank AS | Eregli Demir vs. QNB Finans Finansal | Eregli Demir vs. Turkiye Kalkinma Bankasi | Eregli Demir vs. Kocaer Celik Sanayi |
| Qnb Finansbank vs. Turkiye Is Bankasi | Qnb Finansbank vs. Haci Omer Sabanci | Qnb Finansbank vs. Turkiye Vakiflar Bankasi | Qnb Finansbank vs. Turkiye Halk 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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