Correlation Between Telkom Indonesia and Turkcell Iletisim
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Turkcell Iletisim 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 Telkom Indonesia and Turkcell Iletisim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telkom Indonesia Tbk and Turkcell Iletisim Hizmetleri, you can compare the effects of market volatilities on Telkom Indonesia and Turkcell Iletisim 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 Telkom Indonesia with a short position of Turkcell Iletisim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Turkcell Iletisim.
Diversification Opportunities for Telkom Indonesia and Turkcell Iletisim
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Telkom and Turkcell is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Turkcell Iletisim Hizmetleri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkcell Iletisim and Telkom Indonesia 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 Telkom Indonesia Tbk are associated (or correlated) with Turkcell Iletisim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkcell Iletisim has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Turkcell Iletisim go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Turkcell Iletisim
Considering the 90-day investment horizon Telkom Indonesia Tbk is expected to under-perform the Turkcell Iletisim. In addition to that, Telkom Indonesia is 1.05 times more volatile than Turkcell Iletisim Hizmetleri. It trades about -0.21 of its total potential returns per unit of risk. Turkcell Iletisim Hizmetleri is currently generating about 0.21 per unit of volatility. If you would invest 628.00 in Turkcell Iletisim Hizmetleri on August 24, 2024 and sell it today you would earn a total of 55.00 from holding Turkcell Iletisim Hizmetleri or generate 8.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Turkcell Iletisim Hizmetleri
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Turkcell Iletisim |
Telkom Indonesia and Turkcell Iletisim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Turkcell Iletisim
The main advantage of trading using opposite Telkom Indonesia and Turkcell Iletisim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Turkcell Iletisim 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 Turkcell Iletisim will offset losses from the drop in Turkcell Iletisim's long position.| Telkom Indonesia vs. Small Cap Core | Telkom Indonesia vs. FitLife Brands, Common | Telkom Indonesia vs. Mutual Of America | Telkom Indonesia vs. Gfl Environmental Holdings |
| Turkcell Iletisim vs. Telefonica Brasil SA | Turkcell Iletisim vs. TIM Participacoes SA | Turkcell Iletisim vs. Telkom Indonesia Tbk | Turkcell Iletisim vs. PLDT Inc ADR |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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