Correlation Between AK Sigorta and Is Yatirim

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

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

Diversification Opportunities for AK Sigorta and Is Yatirim

0.53

Correlation Coefficient

AK Sigorta  Is Yatirim

Very weak diversification

The 3 months correlation between AKGRT and ISYAT is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding AK Sigorta AS and Is Yatirim Ortakligi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Is Yatirim Ortakligi and AK Sigorta 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 AK Sigorta AS are associated (or correlated) with Is Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Is Yatirim Ortakligi has no effect on the direction of AK Sigorta i.e., AK Sigorta and Is Yatirim go up and down completely randomly.

Pair Corralation between AK Sigorta and Is Yatirim

Assuming the 90 days trading horizon AK Sigorta AS is expected to generate 2.33 times more return on investment than Is Yatirim. However, AK Sigorta is 2.33 times more volatile than Is Yatirim Ortakligi. It trades about 0.01 of its potential returns per unit of risk. Is Yatirim Ortakligi is currently generating about -0.04 per unit of risk. If you would invest  734.00  in AK Sigorta AS on October 10, 2024 and sell it today you would lose (2.00) from holding AK Sigorta AS or give up 0.27% of portfolio value over 90 days.

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

AK Sigorta AS  vs.  Is Yatirim Ortakligi

AK Sigorta AS

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AK Sigorta AS are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, AK Sigorta demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Is Yatirim Ortakligi

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Is Yatirim Ortakligi are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Is Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AK Sigorta and Is Yatirim

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

The idea behind AK Sigorta AS and Is Yatirim Ortakligi 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.