Correlation Between Celebi Hava and Otokar Otomotiv

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

By analyzing existing cross correlation between Celebi Hava Servisi and Otokar Otomotiv ve, you can compare the effects of market volatilities on Celebi Hava and Otokar Otomotiv 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 Celebi Hava with a short position of Otokar Otomotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celebi Hava and Otokar Otomotiv.

Diversification Opportunities for Celebi Hava and Otokar Otomotiv

0.48

Correlation Coefficient

Celebi Hava  Otokar Otomotiv

Very weak diversification

The 3 months correlation between Celebi and Otokar is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Celebi Hava Servisi and Otokar Otomotiv ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Otokar Otomotiv ve and Celebi Hava 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 Celebi Hava Servisi are associated (or correlated) with Otokar Otomotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Otokar Otomotiv ve has no effect on the direction of Celebi Hava i.e., Celebi Hava and Otokar Otomotiv go up and down completely randomly.

Pair Corralation between Celebi Hava and Otokar Otomotiv

Assuming the 90 days trading horizon Celebi Hava Servisi is expected to under-perform the Otokar Otomotiv. But the stock apears to be less risky and, when comparing its historical volatility, Celebi Hava Servisi is 1.19 times less risky than Otokar Otomotiv. The stock trades about -0.5 of its potential returns per unit of risk. The Otokar Otomotiv ve is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  45,825  in Otokar Otomotiv ve on September 23, 2024 and sell it today you would earn a total of  1,350  from holding Otokar Otomotiv ve or generate 2.95% return on investment over 90 days.

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

Celebi Hava Servisi  vs.  Otokar Otomotiv ve

Celebi Hava Servisi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Celebi Hava Servisi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Celebi Hava is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Otokar Otomotiv ve

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Otokar Otomotiv ve are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Otokar Otomotiv is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Celebi Hava and Otokar Otomotiv

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

The idea behind Celebi Hava Servisi and Otokar Otomotiv 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.