Correlation Between Kardemir Karabuk and Petkim Petrokimya
Can any of the company-specific risk be diversified away by investing in both Kardemir Karabuk and Petkim Petrokimya 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 Kardemir Karabuk and Petkim Petrokimya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kardemir Karabuk Demir and Petkim Petrokimya Holding, you can compare the effects of market volatilities on Kardemir Karabuk and Petkim Petrokimya 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 Kardemir Karabuk with a short position of Petkim Petrokimya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kardemir Karabuk and Petkim Petrokimya.
Diversification Opportunities for Kardemir Karabuk and Petkim Petrokimya
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kardemir and Petkim is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Kardemir Karabuk Demir and Petkim Petrokimya Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petkim Petrokimya Holding and Kardemir Karabuk 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 Kardemir Karabuk Demir are associated (or correlated) with Petkim Petrokimya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petkim Petrokimya Holding has no effect on the direction of Kardemir Karabuk i.e., Kardemir Karabuk and Petkim Petrokimya go up and down completely randomly.
Pair Corralation between Kardemir Karabuk and Petkim Petrokimya
Assuming the 90 days trading horizon Kardemir Karabuk Demir is expected to generate 1.14 times more return on investment than Petkim Petrokimya. However, Kardemir Karabuk is 1.14 times more volatile than Petkim Petrokimya Holding. It trades about 0.19 of its potential returns per unit of risk. Petkim Petrokimya Holding is currently generating about -0.04 per unit of risk. If you would invest 2,462 in Kardemir Karabuk Demir on August 25, 2024 and sell it today you would earn a total of 226.00 from holding Kardemir Karabuk Demir or generate 9.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kardemir Karabuk Demir vs. Petkim Petrokimya Holding
Performance |
| Timeline |
| Kardemir Karabuk Demir |
| Petkim Petrokimya Holding |
Kardemir Karabuk and Petkim Petrokimya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kardemir Karabuk and Petkim Petrokimya
The main advantage of trading using opposite Kardemir Karabuk and Petkim Petrokimya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kardemir Karabuk position performs unexpectedly, Petkim Petrokimya 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 Petkim Petrokimya will offset losses from the drop in Petkim Petrokimya's long position.| Kardemir Karabuk vs. ICBC Turkey Bank | Kardemir Karabuk vs. Politeknik Metal Sanayi | Kardemir Karabuk vs. MEGA METAL | Kardemir Karabuk vs. Sekerbank TAS |
| Petkim Petrokimya vs. Qnb Finansbank AS | Petkim Petrokimya vs. QNB Finans Finansal | Petkim Petrokimya vs. Turkiye Kalkinma Bankasi | Petkim Petrokimya vs. Kocaer Celik Sanayi |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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