Correlation Between ICBC Turkey and Petrokent Turizm
Can any of the company-specific risk be diversified away by investing in both ICBC Turkey and Petrokent Turizm 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 Petrokent Turizm 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 Petrokent Turizm AS, you can compare the effects of market volatilities on ICBC Turkey and Petrokent Turizm 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 Petrokent Turizm. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICBC Turkey and Petrokent Turizm.
Diversification Opportunities for ICBC Turkey and Petrokent Turizm
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ICBC and Petrokent is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding ICBC Turkey Bank and Petrokent Turizm AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrokent Turizm 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 Petrokent Turizm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrokent Turizm has no effect on the direction of ICBC Turkey i.e., ICBC Turkey and Petrokent Turizm go up and down completely randomly.
Pair Corralation between ICBC Turkey and Petrokent Turizm
Assuming the 90 days trading horizon ICBC Turkey Bank is expected to under-perform the Petrokent Turizm. But the stock apears to be less risky and, when comparing its historical volatility, ICBC Turkey Bank is 1.32 times less risky than Petrokent Turizm. The stock trades about -0.02 of its potential returns per unit of risk. The Petrokent Turizm AS is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 24,370 in Petrokent Turizm AS on October 9, 2024 and sell it today you would earn a total of 2,880 from holding Petrokent Turizm AS or generate 11.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICBC Turkey Bank vs. Petrokent Turizm AS
Performance |
| Timeline |
| ICBC Turkey Bank |
| Petrokent Turizm |
ICBC Turkey and Petrokent Turizm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICBC Turkey and Petrokent Turizm
The main advantage of trading using opposite ICBC Turkey and Petrokent Turizm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICBC Turkey position performs unexpectedly, Petrokent Turizm 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 Petrokent Turizm will offset losses from the drop in Petrokent Turizm's long position.| ICBC Turkey vs. Gentas Genel Metal | ICBC Turkey vs. E Data Teknoloji Pazarlama | ICBC Turkey vs. MEGA METAL | ICBC Turkey vs. Silverline Endustri ve |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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