Correlation Between Petrokent Turizm and Bosch Fren

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

By analyzing existing cross correlation between Petrokent Turizm AS and Bosch Fren Sistemleri, you can compare the effects of market volatilities on Petrokent Turizm and Bosch Fren 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 Petrokent Turizm with a short position of Bosch Fren. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrokent Turizm and Bosch Fren.

Diversification Opportunities for Petrokent Turizm and Bosch Fren

0.22

Correlation Coefficient

Petrokent Turizm  Bosch Fren

Modest diversification

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

Pair Corralation between Petrokent Turizm and Bosch Fren

Assuming the 90 days trading horizon Petrokent Turizm AS is expected to generate 1.14 times more return on investment than Bosch Fren. However, Petrokent Turizm is 1.14 times more volatile than Bosch Fren Sistemleri. It trades about 0.11 of its potential returns per unit of risk. Bosch Fren Sistemleri is currently generating about 0.02 per unit of risk. If you would invest  21,140  in Petrokent Turizm AS on October 1, 2024 and sell it today you would earn a total of  4,010  from holding Petrokent Turizm AS or generate 18.97% return on investment over 90 days.

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

Petrokent Turizm AS  vs.  Bosch Fren Sistemleri

Petrokent Turizm

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Petrokent Turizm AS are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Petrokent Turizm demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Bosch Fren Sistemleri

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bosch Fren Sistemleri are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Bosch Fren is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Petrokent Turizm and Bosch Fren

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

The idea behind Petrokent Turizm AS and Bosch Fren Sistemleri 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.