Correlation Between Kustur Kusadasi and Turkcell Iletisim

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

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

Diversification Opportunities for Kustur Kusadasi and Turkcell Iletisim

0.61

Correlation Coefficient

Kustur Kusadasi  Turkcell Iletisim

Poor diversification

The 3 months correlation between Kustur and Turkcell is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Kustur Kusadasi Turizm and Turkcell Iletisim Hizmetleri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkcell Iletisim and Kustur Kusadasi 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 Kustur Kusadasi Turizm are associated (or correlated) with Turkcell Iletisim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkcell Iletisim has no effect on the direction of Kustur Kusadasi i.e., Kustur Kusadasi and Turkcell Iletisim go up and down completely randomly.

Pair Corralation between Kustur Kusadasi and Turkcell Iletisim

Assuming the 90 days trading horizon Kustur Kusadasi Turizm is expected to under-perform the Turkcell Iletisim. In addition to that, Kustur Kusadasi is 2.58 times more volatile than Turkcell Iletisim Hizmetleri. It trades about -0.03 of its total potential returns per unit of risk. Turkcell Iletisim Hizmetleri is currently generating about 0.01 per unit of volatility. If you would invest  9,188  in Turkcell Iletisim Hizmetleri on September 22, 2024 and sell it today you would lose (43.00) from holding Turkcell Iletisim Hizmetleri or give up 0.47% of portfolio value over 90 days.

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

Kustur Kusadasi Turizm  vs.  Turkcell Iletisim Hizmetleri

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.

Turkcell Iletisim

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Kustur Kusadasi and Turkcell Iletisim

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

The idea behind Kustur Kusadasi Turizm and Turkcell Iletisim Hizmetleri 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.