Correlation Between Otokar Otomotiv and BIM Birlesik
Can any of the company-specific risk be diversified away by investing in both Otokar Otomotiv and BIM Birlesik 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 Otokar Otomotiv and BIM Birlesik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Otokar Otomotiv ve and BIM Birlesik Magazalar, you can compare the effects of market volatilities on Otokar Otomotiv and BIM Birlesik 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 Otokar Otomotiv with a short position of BIM Birlesik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Otokar Otomotiv and BIM Birlesik.
Diversification Opportunities for Otokar Otomotiv and BIM Birlesik
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Otokar and BIM is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Otokar Otomotiv ve and BIM Birlesik Magazalar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIM Birlesik Magazalar and Otokar Otomotiv 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 Otokar Otomotiv ve are associated (or correlated) with BIM Birlesik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIM Birlesik Magazalar has no effect on the direction of Otokar Otomotiv i.e., Otokar Otomotiv and BIM Birlesik go up and down completely randomly.
Pair Corralation between Otokar Otomotiv and BIM Birlesik
Assuming the 90 days trading horizon Otokar Otomotiv ve is expected to generate 0.66 times more return on investment than BIM Birlesik. However, Otokar Otomotiv ve is 1.51 times less risky than BIM Birlesik. It trades about 0.38 of its potential returns per unit of risk. BIM Birlesik Magazalar is currently generating about 0.04 per unit of risk. If you would invest 41,500 in Otokar Otomotiv ve on September 1, 2024 and sell it today you would earn a total of 5,925 from holding Otokar Otomotiv ve or generate 14.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Otokar Otomotiv ve vs. BIM Birlesik Magazalar
Performance |
| Timeline |
| Otokar Otomotiv ve |
| BIM Birlesik Magazalar |
Otokar Otomotiv and BIM Birlesik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Otokar Otomotiv and BIM Birlesik
The main advantage of trading using opposite Otokar Otomotiv and BIM Birlesik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Otokar Otomotiv position performs unexpectedly, BIM Birlesik 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 BIM Birlesik will offset losses from the drop in BIM Birlesik's long position.| Otokar Otomotiv vs. Ford Otomotiv Sanayi | Otokar Otomotiv vs. Tofas Turk Otomobil | Otokar Otomotiv vs. Turk Traktor ve | Otokar Otomotiv vs. Arcelik AS |
| BIM Birlesik vs. Eregli Demir ve | BIM Birlesik vs. Turkiye Petrol Rafinerileri | BIM Birlesik vs. Turkiye Sise ve | BIM Birlesik vs. Ford Otomotiv 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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