Correlation Between Kocaer Celik and Turkiye Kalkinma
Can any of the company-specific risk be diversified away by investing in both Kocaer Celik and Turkiye Kalkinma 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 Kocaer Celik and Turkiye Kalkinma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kocaer Celik Sanayi and Turkiye Kalkinma Bankasi, you can compare the effects of market volatilities on Kocaer Celik and Turkiye Kalkinma 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 Kocaer Celik with a short position of Turkiye Kalkinma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kocaer Celik and Turkiye Kalkinma.
Diversification Opportunities for Kocaer Celik and Turkiye Kalkinma
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kocaer and Turkiye is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Kocaer Celik Sanayi and Turkiye Kalkinma Bankasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkiye Kalkinma Bankasi and Kocaer Celik 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 Kocaer Celik Sanayi are associated (or correlated) with Turkiye Kalkinma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkiye Kalkinma Bankasi has no effect on the direction of Kocaer Celik i.e., Kocaer Celik and Turkiye Kalkinma go up and down completely randomly.
Pair Corralation between Kocaer Celik and Turkiye Kalkinma
Assuming the 90 days trading horizon Kocaer Celik Sanayi is expected to generate 1.7 times more return on investment than Turkiye Kalkinma. However, Kocaer Celik is 1.7 times more volatile than Turkiye Kalkinma Bankasi. It trades about 0.21 of its potential returns per unit of risk. Turkiye Kalkinma Bankasi is currently generating about 0.0 per unit of risk. If you would invest 3,710 in Kocaer Celik Sanayi on August 28, 2024 and sell it today you would earn a total of 360.00 from holding Kocaer Celik Sanayi or generate 9.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kocaer Celik Sanayi vs. Turkiye Kalkinma Bankasi
Performance |
| Timeline |
| Kocaer Celik Sanayi |
| Turkiye Kalkinma Bankasi |
Kocaer Celik and Turkiye Kalkinma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kocaer Celik and Turkiye Kalkinma
The main advantage of trading using opposite Kocaer Celik and Turkiye Kalkinma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kocaer Celik position performs unexpectedly, Turkiye Kalkinma 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 Turkiye Kalkinma will offset losses from the drop in Turkiye Kalkinma's long position.| Kocaer Celik vs. Eregli Demir ve | Kocaer Celik vs. Iskenderun Demir ve | Kocaer Celik vs. Borusan Yatirim ve | Kocaer Celik vs. Kardemir Karabuk Demir |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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