Correlation Between Turk Telekomunikasyon and Koc Holding
Can any of the company-specific risk be diversified away by investing in both Turk Telekomunikasyon and Koc Holding 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 Turk Telekomunikasyon and Koc Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Turk Telekomunikasyon AS and Koc Holding AS, you can compare the effects of market volatilities on Turk Telekomunikasyon and Koc Holding 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 Turk Telekomunikasyon with a short position of Koc Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turk Telekomunikasyon and Koc Holding.
Diversification Opportunities for Turk Telekomunikasyon and Koc Holding
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Turk and Koc is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Turk Telekomunikasyon AS and Koc Holding AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koc Holding AS and Turk Telekomunikasyon 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 Turk Telekomunikasyon AS are associated (or correlated) with Koc Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koc Holding AS has no effect on the direction of Turk Telekomunikasyon i.e., Turk Telekomunikasyon and Koc Holding go up and down completely randomly.
Pair Corralation between Turk Telekomunikasyon and Koc Holding
Assuming the 90 days trading horizon Turk Telekomunikasyon is expected to generate 8.19 times less return on investment than Koc Holding. But when comparing it to its historical volatility, Turk Telekomunikasyon AS is 1.03 times less risky than Koc Holding. It trades about 0.04 of its potential returns per unit of risk. Koc Holding AS is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 17,240 in Koc Holding AS on August 27, 2024 and sell it today you would earn a total of 2,190 from holding Koc Holding AS or generate 12.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Turk Telekomunikasyon AS vs. Koc Holding AS
Performance |
| Timeline |
| Turk Telekomunikasyon |
| Koc Holding AS |
Turk Telekomunikasyon and Koc Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Turk Telekomunikasyon and Koc Holding
The main advantage of trading using opposite Turk Telekomunikasyon and Koc Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Turk Telekomunikasyon position performs unexpectedly, Koc Holding 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 Koc Holding will offset losses from the drop in Koc Holding's long position.| Turk Telekomunikasyon vs. Turkcell Iletisim Hizmetleri | Turk Telekomunikasyon vs. Haci Omer Sabanci | Turk Telekomunikasyon vs. Arcelik AS | Turk Telekomunikasyon vs. Petkim Petrokimya Holding |
| Koc Holding vs. Haci Omer Sabanci | Koc Holding vs. Turkiye Sise ve | Koc Holding vs. Turkiye Petrol Rafinerileri | Koc Holding vs. Turkiye Garanti Bankasi |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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