Correlation Between Tofas Turk and Turk Traktor
Can any of the company-specific risk be diversified away by investing in both Tofas Turk and Turk Traktor 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 Turk Traktor 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 Turk Traktor ve, you can compare the effects of market volatilities on Tofas Turk and Turk Traktor 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 Turk Traktor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tofas Turk and Turk Traktor.
Diversification Opportunities for Tofas Turk and Turk Traktor
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tofas and Turk is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Tofas Turk Otomobil and Turk Traktor ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turk Traktor ve 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 Turk Traktor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turk Traktor ve has no effect on the direction of Tofas Turk i.e., Tofas Turk and Turk Traktor go up and down completely randomly.
Pair Corralation between Tofas Turk and Turk Traktor
Assuming the 90 days trading horizon Tofas Turk is expected to generate 2.49 times less return on investment than Turk Traktor. But when comparing it to its historical volatility, Tofas Turk Otomobil is 2.04 times less risky than Turk Traktor. It trades about 0.05 of its potential returns per unit of risk. Turk Traktor ve is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 24,398 in Turk Traktor ve on August 29, 2024 and sell it today you would earn a total of 52,102 from holding Turk Traktor ve or generate 213.55% 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. Turk Traktor ve
Performance |
| Timeline |
| Tofas Turk Otomobil |
| Turk Traktor ve |
Tofas Turk and Turk Traktor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tofas Turk and Turk Traktor
The main advantage of trading using opposite Tofas Turk and Turk Traktor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tofas Turk position performs unexpectedly, Turk Traktor 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 Turk Traktor will offset losses from the drop in Turk Traktor'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 |
| Turk Traktor vs. Ford Otomotiv Sanayi | Turk Traktor vs. Tofas Turk Otomobil | Turk Traktor vs. Eregli Demir ve | Turk Traktor vs. Turkiye Petrol Rafinerileri |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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