Correlation Between Creditwest Faktoring and Kustur Kusadasi

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

By analyzing existing cross correlation between Creditwest Faktoring AS and Kustur Kusadasi Turizm, you can compare the effects of market volatilities on Creditwest Faktoring and Kustur Kusadasi 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 Creditwest Faktoring with a short position of Kustur Kusadasi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creditwest Faktoring and Kustur Kusadasi.

Diversification Opportunities for Creditwest Faktoring and Kustur Kusadasi

0.63

Correlation Coefficient

Creditwest Faktoring  Kustur Kusadasi

Poor diversification

The 3 months correlation between Creditwest and Kustur is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Creditwest Faktoring AS and Kustur Kusadasi Turizm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kustur Kusadasi Turizm and Creditwest Faktoring 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 Creditwest Faktoring AS are associated (or correlated) with Kustur Kusadasi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kustur Kusadasi Turizm has no effect on the direction of Creditwest Faktoring i.e., Creditwest Faktoring and Kustur Kusadasi go up and down completely randomly.

Pair Corralation between Creditwest Faktoring and Kustur Kusadasi

Assuming the 90 days trading horizon Creditwest Faktoring AS is expected to generate 0.68 times more return on investment than Kustur Kusadasi. However, Creditwest Faktoring AS is 1.48 times less risky than Kustur Kusadasi. It trades about 0.01 of its potential returns per unit of risk. Kustur Kusadasi Turizm is currently generating about -0.03 per unit of risk. If you would invest  621.00  in Creditwest Faktoring AS on September 22, 2024 and sell it today you would lose (9.00) from holding Creditwest Faktoring AS or give up 1.45% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

Creditwest Faktoring AS  vs.  Kustur Kusadasi Turizm

Creditwest Faktoring

Risk-Adjusted Performance

0 of 100

Very Weak

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

Kustur Kusadasi Turizm

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kustur Kusadasi Turizm has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Creditwest Faktoring and Kustur Kusadasi

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

The idea behind Creditwest Faktoring AS and Kustur Kusadasi Turizm 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.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.