Correlation Between Ford and Burcelik Bursa

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

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

Diversification Opportunities for Ford and Burcelik Bursa

0.07

Correlation Coefficient

Ford  Burcelik Bursa

Significant diversification

The 3 months correlation between Ford and Burcelik is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Burcelik Bursa Celik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burcelik Bursa Celik and Ford 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 Ford Motor are associated (or correlated) with Burcelik Bursa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burcelik Bursa Celik has no effect on the direction of Ford i.e., Ford and Burcelik Bursa go up and down completely randomly.

Pair Corralation between Ford and Burcelik Bursa

Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.62 times more return on investment than Burcelik Bursa. However, Ford Motor is 1.6 times less risky than Burcelik Bursa. It trades about -0.05 of its potential returns per unit of risk. Burcelik Bursa Celik is currently generating about -0.06 per unit of risk. If you would invest  1,083  in Ford Motor on September 18, 2024 and sell it today you would lose (84.00) from holding Ford Motor or give up 7.76% of portfolio value over 90 days.

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

Ford Motor  vs.  Burcelik Bursa Celik

Ford Motor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ford Motor has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Burcelik Bursa Celik

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Burcelik Bursa Celik 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.

Pair Trading with Ford and Burcelik Bursa

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

The idea behind Ford Motor and Burcelik Bursa Celik 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.