Correlation Between Turkiye Kalkinma and Koza Anadolu

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

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

Diversification Opportunities for Turkiye Kalkinma and Koza Anadolu

0.22

Correlation Coefficient

Turkiye Kalkinma  Koza Anadolu

Modest diversification

The 3 months correlation between Turkiye and Koza is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Kalkinma Bankasi and Koza Anadolu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koza Anadolu Metal and Turkiye Kalkinma 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 Kalkinma Bankasi are associated (or correlated) with Koza Anadolu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koza Anadolu Metal has no effect on the direction of Turkiye Kalkinma i.e., Turkiye Kalkinma and Koza Anadolu go up and down completely randomly.

Pair Corralation between Turkiye Kalkinma and Koza Anadolu

Assuming the 90 days trading horizon Turkiye Kalkinma Bankasi is expected to under-perform the Koza Anadolu. But the stock apears to be less risky and, when comparing its historical volatility, Turkiye Kalkinma Bankasi is 1.74 times less risky than Koza Anadolu. The stock trades about -0.12 of its potential returns per unit of risk. The Koza Anadolu Metal is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  6,340  in Koza Anadolu Metal on August 30, 2024 and sell it today you would earn a total of  615.00  from holding Koza Anadolu Metal or generate 9.7% return on investment over 90 days.

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

Turkiye Kalkinma Bankasi  vs.  Koza Anadolu Metal

Turkiye Kalkinma Bankasi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Turkiye Kalkinma Bankasi 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 December 2024. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Koza Anadolu Metal

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Koza Anadolu Metal are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, Koza Anadolu may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Turkiye Kalkinma and Koza Anadolu

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

The idea behind Turkiye Kalkinma Bankasi and Koza Anadolu Metal 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.