Correlation Between Platform Turizm and Ford Otomotiv

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

By analyzing existing cross correlation between Platform Turizm Tasimacilik and Ford Otomotiv Sanayi, you can compare the effects of market volatilities on Platform Turizm and Ford 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 Platform Turizm with a short position of Ford Otomotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platform Turizm and Ford Otomotiv.

Diversification Opportunities for Platform Turizm and Ford Otomotiv

0.27

Correlation Coefficient

Platform Turizm  Ford Otomotiv

Modest diversification

The 3 months correlation between Platform and Ford is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Platform Turizm Tasimacilik and Ford Otomotiv Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ford Otomotiv Sanayi and Platform 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 Platform Turizm Tasimacilik are associated (or correlated) with Ford Otomotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ford Otomotiv Sanayi has no effect on the direction of Platform Turizm i.e., Platform Turizm and Ford Otomotiv go up and down completely randomly.

Pair Corralation between Platform Turizm and Ford Otomotiv

Assuming the 90 days trading horizon Platform Turizm Tasimacilik is expected to generate 2.92 times more return on investment than Ford Otomotiv. However, Platform Turizm is 2.92 times more volatile than Ford Otomotiv Sanayi. It trades about 0.39 of its potential returns per unit of risk. Ford Otomotiv Sanayi is currently generating about -0.28 per unit of risk. If you would invest  2,588  in Platform Turizm Tasimacilik on September 25, 2024 and sell it today you would earn a total of  724.00  from holding Platform Turizm Tasimacilik or generate 27.98% return on investment over 90 days.

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

Platform Turizm Tasimacilik  vs.  Ford Otomotiv Sanayi

Platform Turizm Tasi

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Platform Turizm Tasimacilik are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Platform Turizm demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Ford Otomotiv Sanayi

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ford Otomotiv Sanayi are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Ford Otomotiv is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Platform Turizm and Ford Otomotiv

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

The idea behind Platform Turizm Tasimacilik and Ford Otomotiv Sanayi 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.