Correlation Between Akbank TAS and Tumosan

Can any of the company-specific risk be diversified away by investing in both Akbank TAS and Tumosan 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 Akbank TAS and Tumosan into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Akbank TAS and Tumosan Motor ve, you can compare the effects of market volatilities on Akbank TAS and Tumosan 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 Akbank TAS with a short position of Tumosan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akbank TAS and Tumosan.

Diversification Opportunities for Akbank TAS and Tumosan

0.41

Correlation Coefficient

Akbank TAS  Tumosan

Very weak diversification

The 3 months correlation between Akbank and Tumosan is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Akbank TAS and Tumosan Motor ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tumosan Motor ve and Akbank TAS 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 Akbank TAS are associated (or correlated) with Tumosan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tumosan Motor ve has no effect on the direction of Akbank TAS i.e., Akbank TAS and Tumosan go up and down completely randomly.

Pair Corralation between Akbank TAS and Tumosan

Assuming the 90 days trading horizon Akbank TAS is expected to generate 0.81 times more return on investment than Tumosan. However, Akbank TAS is 1.23 times less risky than Tumosan. It trades about 0.1 of its potential returns per unit of risk. Tumosan Motor ve is currently generating about 0.04 per unit of risk. If you would invest  1,608  in Akbank TAS on September 5, 2024 and sell it today you would earn a total of  4,732  from holding Akbank TAS or generate 294.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Akbank TAS  vs.  Tumosan Motor ve

Akbank TAS

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Akbank TAS are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Akbank TAS may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Tumosan Motor ve

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tumosan Motor ve has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Tumosan is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Akbank TAS and Tumosan

The main advantage of trading using opposite Akbank TAS and Tumosan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akbank TAS position performs unexpectedly, Tumosan 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 Tumosan will offset losses from the drop in Tumosan's long position.

The idea behind Akbank TAS and Tumosan Motor ve pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.