Correlation Between Adese Gayrimenkul and BINHO

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

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

Diversification Opportunities for Adese Gayrimenkul and BINHO

0.49

Correlation Coefficient

Adese Gayrimenkul  BINHO

Very weak diversification

The 3 months correlation between Adese and BINHO is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Adese Gayrimenkul Yatirim and BINHO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BINHO and Adese Gayrimenkul 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 Adese Gayrimenkul Yatirim are associated (or correlated) with BINHO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BINHO has no effect on the direction of Adese Gayrimenkul i.e., Adese Gayrimenkul and BINHO go up and down completely randomly.

Pair Corralation between Adese Gayrimenkul and BINHO

Assuming the 90 days trading horizon Adese Gayrimenkul Yatirim is expected to generate 0.86 times more return on investment than BINHO. However, Adese Gayrimenkul Yatirim is 1.16 times less risky than BINHO. It trades about 0.2 of its potential returns per unit of risk. BINHO is currently generating about 0.06 per unit of risk. If you would invest  181.00  in Adese Gayrimenkul Yatirim on October 6, 2024 and sell it today you would earn a total of  46.00  from holding Adese Gayrimenkul Yatirim or generate 25.41% return on investment over 90 days.

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

Adese Gayrimenkul Yatirim  vs.  BINHO

Adese Gayrimenkul Yatirim

Risk-Adjusted Performance

8 of 100

OK

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

BINHO

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Adese Gayrimenkul and BINHO

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

The idea behind Adese Gayrimenkul Yatirim and BINHO 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.