Correlation Between GM and Turkcell Iletisim
Can any of the company-specific risk be diversified away by investing in both GM and Turkcell Iletisim 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 GM and Turkcell Iletisim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Turkcell Iletisim Hizmetleri, you can compare the effects of market volatilities on GM and Turkcell Iletisim 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 GM with a short position of Turkcell Iletisim. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Turkcell Iletisim.
Diversification Opportunities for GM and Turkcell Iletisim
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GM and Turkcell is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Turkcell Iletisim Hizmetleri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkcell Iletisim and GM 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 General Motors are associated (or correlated) with Turkcell Iletisim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkcell Iletisim has no effect on the direction of GM i.e., GM and Turkcell Iletisim go up and down completely randomly.
Pair Corralation between GM and Turkcell Iletisim
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.95 times more return on investment than Turkcell Iletisim. However, General Motors is 1.06 times less risky than Turkcell Iletisim. It trades about 0.13 of its potential returns per unit of risk. Turkcell Iletisim Hizmetleri is currently generating about 0.11 per unit of risk. If you would invest 2,879 in General Motors on September 1, 2024 and sell it today you would earn a total of 2,680 from holding General Motors or generate 93.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
General Motors vs. Turkcell Iletisim Hizmetleri
Performance |
| Timeline |
| General Motors |
| Turkcell Iletisim |
GM and Turkcell Iletisim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Turkcell Iletisim
The main advantage of trading using opposite GM and Turkcell Iletisim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Turkcell Iletisim 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 Turkcell Iletisim will offset losses from the drop in Turkcell Iletisim's long position.The idea behind General Motors and Turkcell Iletisim Hizmetleri 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.| Turkcell Iletisim vs. Trabzon Liman Isletmeciligi | Turkcell Iletisim vs. Bayrak EBT Taban | Turkcell Iletisim vs. Birikim Varlik Yonetim | Turkcell Iletisim vs. Inveo Yatirim Holding |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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