Correlation Between Iskenderun Demir and Dogus Otomotiv

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

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

Diversification Opportunities for Iskenderun Demir and Dogus Otomotiv

0.04

Correlation Coefficient

Iskenderun Demir  Dogus Otomotiv

Significant diversification

The 3 months correlation between Iskenderun and Dogus is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Iskenderun Demir ve and Dogus Otomotiv Servis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dogus Otomotiv Servis and Iskenderun Demir 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 Iskenderun Demir ve are associated (or correlated) with Dogus Otomotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dogus Otomotiv Servis has no effect on the direction of Iskenderun Demir i.e., Iskenderun Demir and Dogus Otomotiv go up and down completely randomly.

Pair Corralation between Iskenderun Demir and Dogus Otomotiv

Assuming the 90 days trading horizon Iskenderun Demir ve is expected to generate 1.2 times more return on investment than Dogus Otomotiv. However, Iskenderun Demir is 1.2 times more volatile than Dogus Otomotiv Servis. It trades about 0.15 of its potential returns per unit of risk. Dogus Otomotiv Servis is currently generating about -0.07 per unit of risk. If you would invest  3,466  in Iskenderun Demir ve on September 23, 2024 and sell it today you would earn a total of  692.00  from holding Iskenderun Demir ve or generate 19.97% return on investment over 90 days.

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

Iskenderun Demir ve  vs.  Dogus Otomotiv Servis

Iskenderun Demir

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Iskenderun Demir ve has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly weak forward indicators, Iskenderun Demir demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Dogus Otomotiv Servis

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dogus Otomotiv Servis has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Iskenderun Demir and Dogus Otomotiv

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

The idea behind Iskenderun Demir ve and Dogus Otomotiv Servis 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.