Correlation Between Petrokent Turizm and Bms Birlesik
Can any of the company-specific risk be diversified away by investing in both Petrokent Turizm and Bms 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 Petrokent Turizm and Bms Birlesik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petrokent Turizm AS and Bms Birlesik Metal, you can compare the effects of market volatilities on Petrokent Turizm and Bms 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 Petrokent Turizm with a short position of Bms Birlesik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrokent Turizm and Bms Birlesik.
Diversification Opportunities for Petrokent Turizm and Bms Birlesik
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Petrokent and Bms is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Petrokent Turizm AS and Bms Birlesik Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bms Birlesik Metal and Petrokent Turizm 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 Petrokent Turizm AS are associated (or correlated) with Bms Birlesik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bms Birlesik Metal has no effect on the direction of Petrokent Turizm i.e., Petrokent Turizm and Bms Birlesik go up and down completely randomly.
Pair Corralation between Petrokent Turizm and Bms Birlesik
Assuming the 90 days trading horizon Petrokent Turizm is expected to generate 2.79 times less return on investment than Bms Birlesik. But when comparing it to its historical volatility, Petrokent Turizm AS is 1.22 times less risky than Bms Birlesik. It trades about 0.07 of its potential returns per unit of risk. Bms Birlesik Metal is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 2,681 in Bms Birlesik Metal on September 15, 2024 and sell it today you would earn a total of 281.00 from holding Bms Birlesik Metal or generate 10.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Petrokent Turizm AS vs. Bms Birlesik Metal
Performance |
| Timeline |
| Petrokent Turizm |
| Bms Birlesik Metal |
Petrokent Turizm and Bms Birlesik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrokent Turizm and Bms Birlesik
The main advantage of trading using opposite Petrokent Turizm and Bms Birlesik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrokent Turizm position performs unexpectedly, Bms 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 Bms Birlesik will offset losses from the drop in Bms Birlesik's long position.| Petrokent Turizm vs. MEGA METAL | Petrokent Turizm vs. Gentas Genel Metal | Petrokent Turizm vs. Politeknik Metal Sanayi | Petrokent Turizm vs. Koza Anadolu 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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