Correlation Between Tofas Turk and Aygaz AS
Can any of the company-specific risk be diversified away by investing in both Tofas Turk and Aygaz AS 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 Tofas Turk and Aygaz AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tofas Turk Otomobil and Aygaz AS, you can compare the effects of market volatilities on Tofas Turk and Aygaz AS 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 Tofas Turk with a short position of Aygaz AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tofas Turk and Aygaz AS.
Diversification Opportunities for Tofas Turk and Aygaz AS
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tofas and Aygaz is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Tofas Turk Otomobil and Aygaz AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aygaz AS and Tofas Turk 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 Tofas Turk Otomobil are associated (or correlated) with Aygaz AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aygaz AS has no effect on the direction of Tofas Turk i.e., Tofas Turk and Aygaz AS go up and down completely randomly.
Pair Corralation between Tofas Turk and Aygaz AS
Assuming the 90 days trading horizon Tofas Turk is expected to generate 1.58 times less return on investment than Aygaz AS. But when comparing it to its historical volatility, Tofas Turk Otomobil is 1.04 times less risky than Aygaz AS. It trades about 0.05 of its potential returns per unit of risk. Aygaz AS is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7,664 in Aygaz AS on August 30, 2024 and sell it today you would earn a total of 10,386 from holding Aygaz AS or generate 135.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tofas Turk Otomobil vs. Aygaz AS
Performance |
| Timeline |
| Tofas Turk Otomobil |
| Aygaz AS |
Tofas Turk and Aygaz AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tofas Turk and Aygaz AS
The main advantage of trading using opposite Tofas Turk and Aygaz AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tofas Turk position performs unexpectedly, Aygaz AS 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 Aygaz AS will offset losses from the drop in Aygaz AS's long position.| Tofas Turk vs. Ford Otomotiv Sanayi | Tofas Turk vs. Eregli Demir ve | Tofas Turk vs. Turkiye Petrol Rafinerileri | Tofas Turk vs. Turkiye Sise ve |
| Aygaz AS vs. Turkiye Petrol Rafinerileri | Aygaz AS vs. Aksa Akrilik Kimya | Aygaz AS vs. Arcelik AS | Aygaz AS vs. Tofas Turk Otomobil |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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