Correlation Between ICBC Turkey and Cuhadaroglu Metal
Can any of the company-specific risk be diversified away by investing in both ICBC Turkey and Cuhadaroglu Metal 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 ICBC Turkey and Cuhadaroglu Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICBC Turkey Bank and Cuhadaroglu Metal Sanayi, you can compare the effects of market volatilities on ICBC Turkey and Cuhadaroglu Metal 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 ICBC Turkey with a short position of Cuhadaroglu Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICBC Turkey and Cuhadaroglu Metal.
Diversification Opportunities for ICBC Turkey and Cuhadaroglu Metal
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ICBC and Cuhadaroglu is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding ICBC Turkey Bank and Cuhadaroglu Metal Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cuhadaroglu Metal Sanayi and ICBC Turkey 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 ICBC Turkey Bank are associated (or correlated) with Cuhadaroglu Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cuhadaroglu Metal Sanayi has no effect on the direction of ICBC Turkey i.e., ICBC Turkey and Cuhadaroglu Metal go up and down completely randomly.
Pair Corralation between ICBC Turkey and Cuhadaroglu Metal
Assuming the 90 days trading horizon ICBC Turkey Bank is expected to generate 1.05 times more return on investment than Cuhadaroglu Metal. However, ICBC Turkey is 1.05 times more volatile than Cuhadaroglu Metal Sanayi. It trades about -0.13 of its potential returns per unit of risk. Cuhadaroglu Metal Sanayi is currently generating about -0.58 per unit of risk. If you would invest 1,422 in ICBC Turkey Bank on November 2, 2024 and sell it today you would lose (74.00) from holding ICBC Turkey Bank or give up 5.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICBC Turkey Bank vs. Cuhadaroglu Metal Sanayi
Performance |
| Timeline |
| ICBC Turkey Bank |
| Cuhadaroglu Metal Sanayi |
ICBC Turkey and Cuhadaroglu Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICBC Turkey and Cuhadaroglu Metal
The main advantage of trading using opposite ICBC Turkey and Cuhadaroglu Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICBC Turkey position performs unexpectedly, Cuhadaroglu Metal 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 Cuhadaroglu Metal will offset losses from the drop in Cuhadaroglu Metal's long position.| ICBC Turkey vs. Politeknik Metal Sanayi | ICBC Turkey vs. MEGA METAL | ICBC Turkey vs. Borlease Otomotiv AS | ICBC Turkey vs. Sekerbank TAS |
| Cuhadaroglu Metal vs. Bms Birlesik Metal | Cuhadaroglu Metal vs. KOC METALURJI | Cuhadaroglu Metal vs. Gentas Genel Metal | Cuhadaroglu Metal vs. MEGA METAL |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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