Correlation Between Kardemir Karabuk and Qnb Finansbank
Can any of the company-specific risk be diversified away by investing in both Kardemir Karabuk and Qnb Finansbank 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 Qnb Finansbank 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 Qnb Finansbank AS, you can compare the effects of market volatilities on Kardemir Karabuk and Qnb Finansbank 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 Qnb Finansbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kardemir Karabuk and Qnb Finansbank.
Diversification Opportunities for Kardemir Karabuk and Qnb Finansbank
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kardemir and Qnb is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Kardemir Karabuk Demir and Qnb Finansbank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qnb Finansbank AS 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 Qnb Finansbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qnb Finansbank AS has no effect on the direction of Kardemir Karabuk i.e., Kardemir Karabuk and Qnb Finansbank go up and down completely randomly.
Pair Corralation between Kardemir Karabuk and Qnb Finansbank
Assuming the 90 days trading horizon Kardemir Karabuk is expected to generate 6.0 times less return on investment than Qnb Finansbank. But when comparing it to its historical volatility, Kardemir Karabuk Demir is 1.87 times less risky than Qnb Finansbank. It trades about 0.04 of its potential returns per unit of risk. Qnb Finansbank AS is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 4,098 in Qnb Finansbank AS on August 31, 2024 and sell it today you would earn a total of 22,902 from holding Qnb Finansbank AS or generate 558.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kardemir Karabuk Demir vs. Qnb Finansbank AS
Performance |
| Timeline |
| Kardemir Karabuk Demir |
| Qnb Finansbank AS |
Kardemir Karabuk and Qnb Finansbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kardemir Karabuk and Qnb Finansbank
The main advantage of trading using opposite Kardemir Karabuk and Qnb Finansbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kardemir Karabuk position performs unexpectedly, Qnb Finansbank 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 Qnb Finansbank will offset losses from the drop in Qnb Finansbank's long position.| Kardemir Karabuk vs. Koza Anadolu Metal | Kardemir Karabuk vs. Bms Birlesik Metal | Kardemir Karabuk vs. ICBC Turkey Bank | Kardemir Karabuk vs. Gentas Genel Metal |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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