Correlation Between Kardemir Karabuk and Sekerbank TAS
Can any of the company-specific risk be diversified away by investing in both Kardemir Karabuk and Sekerbank TAS 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 Sekerbank TAS 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 Sekerbank TAS, you can compare the effects of market volatilities on Kardemir Karabuk and Sekerbank TAS 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 Sekerbank TAS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kardemir Karabuk and Sekerbank TAS.
Diversification Opportunities for Kardemir Karabuk and Sekerbank TAS
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kardemir and Sekerbank is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Kardemir Karabuk Demir and Sekerbank TAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sekerbank TAS 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 Sekerbank TAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sekerbank TAS has no effect on the direction of Kardemir Karabuk i.e., Kardemir Karabuk and Sekerbank TAS go up and down completely randomly.
Pair Corralation between Kardemir Karabuk and Sekerbank TAS
Assuming the 90 days trading horizon Kardemir Karabuk Demir is expected to generate 0.86 times more return on investment than Sekerbank TAS. However, Kardemir Karabuk Demir is 1.17 times less risky than Sekerbank TAS. It trades about 0.11 of its potential returns per unit of risk. Sekerbank TAS is currently generating about 0.06 per unit of risk. If you would invest 2,344 in Kardemir Karabuk Demir on August 30, 2024 and sell it today you would earn a total of 354.00 from holding Kardemir Karabuk Demir or generate 15.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kardemir Karabuk Demir vs. Sekerbank TAS
Performance |
| Timeline |
| Kardemir Karabuk Demir |
| Sekerbank TAS |
Kardemir Karabuk and Sekerbank TAS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kardemir Karabuk and Sekerbank TAS
The main advantage of trading using opposite Kardemir Karabuk and Sekerbank TAS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kardemir Karabuk position performs unexpectedly, Sekerbank TAS 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 Sekerbank TAS will offset losses from the drop in Sekerbank TAS'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 |
| Sekerbank TAS vs. Turkiye Sinai Kalkinma | Sekerbank TAS vs. Yapi ve Kredi | Sekerbank TAS vs. Kardemir Karabuk Demir | Sekerbank TAS vs. Turkiye Is Bankasi |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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