Correlation Between Baticim Bati and Bursa Cimento

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

By analyzing existing cross correlation between Baticim Bati Anadolu and Bursa Cimento Fabrikasi, you can compare the effects of market volatilities on Baticim Bati and Bursa Cimento 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 Baticim Bati with a short position of Bursa Cimento. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baticim Bati and Bursa Cimento.

Diversification Opportunities for Baticim Bati and Bursa Cimento

-0.1

Correlation Coefficient

Baticim Bati  Bursa Cimento

Good diversification

The 3 months correlation between Baticim and Bursa is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Baticim Bati Anadolu and Bursa Cimento Fabrikasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bursa Cimento Fabrikasi and Baticim Bati 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 Baticim Bati Anadolu are associated (or correlated) with Bursa Cimento. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bursa Cimento Fabrikasi has no effect on the direction of Baticim Bati i.e., Baticim Bati and Bursa Cimento go up and down completely randomly.

Pair Corralation between Baticim Bati and Bursa Cimento

Assuming the 90 days trading horizon Baticim Bati Anadolu is expected to under-perform the Bursa Cimento. In addition to that, Baticim Bati is 1.13 times more volatile than Bursa Cimento Fabrikasi. It trades about -0.14 of its total potential returns per unit of risk. Bursa Cimento Fabrikasi is currently generating about 0.06 per unit of volatility. If you would invest  758.00  in Bursa Cimento Fabrikasi on September 24, 2024 and sell it today you would earn a total of  54.00  from holding Bursa Cimento Fabrikasi or generate 7.12% return on investment over 90 days.

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

Baticim Bati Anadolu  vs.  Bursa Cimento Fabrikasi

Baticim Bati Anadolu

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Baticim Bati Anadolu has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Bursa Cimento Fabrikasi

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Bursa Cimento Fabrikasi are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Bursa Cimento may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Baticim Bati and Bursa Cimento

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

The idea behind Baticim Bati Anadolu and Bursa Cimento Fabrikasi 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.