Correlation Between Turkiye Is and Tumosan

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

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

Diversification Opportunities for Turkiye Is and Tumosan

0.67

Correlation Coefficient

Turkiye Is  Tumosan

Poor diversification

The 3 months correlation between Turkiye and Tumosan is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Is Bankasi 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 Turkiye Is 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 Turkiye Is Bankasi 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 Turkiye Is i.e., Turkiye Is and Tumosan go up and down completely randomly.

Pair Corralation between Turkiye Is and Tumosan

Assuming the 90 days trading horizon Turkiye Is Bankasi is expected to generate 1.33 times more return on investment than Tumosan. However, Turkiye Is is 1.33 times more volatile than Tumosan Motor ve. It trades about -0.03 of its potential returns per unit of risk. Tumosan Motor ve is currently generating about -0.09 per unit of risk. If you would invest  54,399,800  in Turkiye Is Bankasi on September 5, 2024 and sell it today you would lose (1,799,800) from holding Turkiye Is Bankasi or give up 3.31% of portfolio value over 90 days.

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

Turkiye Is Bankasi  vs.  Tumosan Motor ve

Turkiye Is Bankasi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Turkiye Is Bankasi 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.

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 Turkiye Is and Tumosan

The main advantage of trading using opposite Turkiye Is and Tumosan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Turkiye Is 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 Turkiye Is Bankasi 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.