Correlation Between Sodas Sodyum and Petrokent Turizm
Can any of the company-specific risk be diversified away by investing in both Sodas Sodyum and Petrokent Turizm 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 Sodas Sodyum and Petrokent Turizm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sodas Sodyum Sanayi and Petrokent Turizm AS, you can compare the effects of market volatilities on Sodas Sodyum and Petrokent Turizm 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 Sodas Sodyum with a short position of Petrokent Turizm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sodas Sodyum and Petrokent Turizm.
Diversification Opportunities for Sodas Sodyum and Petrokent Turizm
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sodas and Petrokent is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Sodas Sodyum Sanayi and Petrokent Turizm AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrokent Turizm and Sodas Sodyum 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 Sodas Sodyum Sanayi are associated (or correlated) with Petrokent Turizm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrokent Turizm has no effect on the direction of Sodas Sodyum i.e., Sodas Sodyum and Petrokent Turizm go up and down completely randomly.
Pair Corralation between Sodas Sodyum and Petrokent Turizm
Assuming the 90 days trading horizon Sodas Sodyum Sanayi is expected to generate 0.8 times more return on investment than Petrokent Turizm. However, Sodas Sodyum Sanayi is 1.26 times less risky than Petrokent Turizm. It trades about -0.18 of its potential returns per unit of risk. Petrokent Turizm AS is currently generating about -0.23 per unit of risk. If you would invest 10,600 in Sodas Sodyum Sanayi on November 3, 2024 and sell it today you would lose (665.00) from holding Sodas Sodyum Sanayi or give up 6.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sodas Sodyum Sanayi vs. Petrokent Turizm AS
Performance |
| Timeline |
| Sodas Sodyum Sanayi |
| Petrokent Turizm |
Sodas Sodyum and Petrokent Turizm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sodas Sodyum and Petrokent Turizm
The main advantage of trading using opposite Sodas Sodyum and Petrokent Turizm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sodas Sodyum position performs unexpectedly, Petrokent Turizm 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 Petrokent Turizm will offset losses from the drop in Petrokent Turizm's long position.| Sodas Sodyum vs. Politeknik Metal Sanayi | Sodas Sodyum vs. Koza Anadolu Metal | Sodas Sodyum vs. ICBC Turkey Bank | Sodas Sodyum vs. Bms Birlesik Metal |
| Petrokent Turizm vs. Gentas Genel Metal | Petrokent Turizm vs. Akbank TAS | Petrokent Turizm vs. KOC METALURJI | Petrokent Turizm vs. Bms Birlesik Metal |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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