Correlation Between Ford and Pinar Su
Can any of the company-specific risk be diversified away by investing in both Ford and Pinar Su 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 Ford and Pinar Su into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Pinar Su Sanayi, you can compare the effects of market volatilities on Ford and Pinar Su 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 Ford with a short position of Pinar Su. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Pinar Su.
Diversification Opportunities for Ford and Pinar Su
Very good diversification
The 3 months correlation between Ford and Pinar is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Pinar Su Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinar Su Sanayi and Ford 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 Ford Motor are associated (or correlated) with Pinar Su. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinar Su Sanayi has no effect on the direction of Ford i.e., Ford and Pinar Su go up and down completely randomly.
Pair Corralation between Ford and Pinar Su
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the Pinar Su. In addition to that, Ford is 1.22 times more volatile than Pinar Su Sanayi. It trades about -0.05 of its total potential returns per unit of risk. Pinar Su Sanayi is currently generating about 0.03 per unit of volatility. If you would invest 638.00 in Pinar Su Sanayi on October 25, 2024 and sell it today you would earn a total of 14.00 from holding Pinar Su Sanayi or generate 2.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Ford Motor vs. Pinar Su Sanayi
Performance |
| Timeline |
| Ford Motor |
| Pinar Su Sanayi |
Ford and Pinar Su Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Pinar Su
The main advantage of trading using opposite Ford and Pinar Su positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Pinar Su 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 Pinar Su will offset losses from the drop in Pinar Su's long position.The idea behind Ford Motor and Pinar Su Sanayi pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Pinar Su vs. Politeknik Metal Sanayi | Pinar Su vs. Sekerbank TAS | Pinar Su vs. Trabzonspor Sportif Yatirim | Pinar Su vs. KOC METALURJI |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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