Correlation Between Turcas Petrol and Guler Yatirim

Can any of the company-specific risk be diversified away by investing in both Turcas Petrol and Guler Yatirim 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 Turcas Petrol and Guler Yatirim into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Turcas Petrol AS and Guler Yatirim Holding, you can compare the effects of market volatilities on Turcas Petrol and Guler Yatirim 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 Turcas Petrol with a short position of Guler Yatirim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turcas Petrol and Guler Yatirim.

Diversification Opportunities for Turcas Petrol and Guler Yatirim

0.82

Correlation Coefficient

Turcas Petrol  Guler Yatirim

Very poor diversification

The 3 months correlation between Turcas and Guler is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Turcas Petrol AS and Guler Yatirim Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guler Yatirim Holding and Turcas Petrol 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 Turcas Petrol AS are associated (or correlated) with Guler Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guler Yatirim Holding has no effect on the direction of Turcas Petrol i.e., Turcas Petrol and Guler Yatirim go up and down completely randomly.

Pair Corralation between Turcas Petrol and Guler Yatirim

Assuming the 90 days trading horizon Turcas Petrol is expected to generate 1.28 times less return on investment than Guler Yatirim. But when comparing it to its historical volatility, Turcas Petrol AS is 1.05 times less risky than Guler Yatirim. It trades about 0.06 of its potential returns per unit of risk. Guler Yatirim Holding is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,150  in Guler Yatirim Holding on September 24, 2024 and sell it today you would earn a total of  116.00  from holding Guler Yatirim Holding or generate 10.09% return on investment over 90 days.

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

Turcas Petrol AS  vs.  Guler Yatirim Holding

Turcas Petrol AS

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Turcas Petrol AS are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Turcas Petrol may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Guler Yatirim Holding

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Guler Yatirim Holding are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Guler Yatirim may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Turcas Petrol and Guler Yatirim

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

The idea behind Turcas Petrol AS and Guler Yatirim Holding 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.