Correlation Between Dogu Aras and Birlik Mensucat

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

By analyzing existing cross correlation between Dogu Aras Enerji and Birlik Mensucat Ticaret, you can compare the effects of market volatilities on Dogu Aras and Birlik Mensucat 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 Dogu Aras with a short position of Birlik Mensucat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dogu Aras and Birlik Mensucat.

Diversification Opportunities for Dogu Aras and Birlik Mensucat

-0.34

Correlation Coefficient

Dogu Aras  Birlik Mensucat

Very good diversification

The 3 months correlation between Dogu and Birlik is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Dogu Aras Enerji and Birlik Mensucat Ticaret in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Birlik Mensucat Ticaret and Dogu Aras 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 Dogu Aras Enerji are associated (or correlated) with Birlik Mensucat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Birlik Mensucat Ticaret has no effect on the direction of Dogu Aras i.e., Dogu Aras and Birlik Mensucat go up and down completely randomly.

Pair Corralation between Dogu Aras and Birlik Mensucat

Assuming the 90 days trading horizon Dogu Aras Enerji is expected to under-perform the Birlik Mensucat. But the stock apears to be less risky and, when comparing its historical volatility, Dogu Aras Enerji is 1.87 times less risky than Birlik Mensucat. The stock trades about 0.0 of its potential returns per unit of risk. The Birlik Mensucat Ticaret is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  520.00  in Birlik Mensucat Ticaret on October 2, 2024 and sell it today you would earn a total of  41.00  from holding Birlik Mensucat Ticaret or generate 7.88% return on investment over 90 days.

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

Dogu Aras Enerji  vs.  Birlik Mensucat Ticaret

Dogu Aras Enerji

Risk-Adjusted Performance

2 of 100

Very Weak

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

Birlik Mensucat Ticaret

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Birlik Mensucat Ticaret are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Birlik Mensucat demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dogu Aras and Birlik Mensucat

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

The idea behind Dogu Aras Enerji and Birlik Mensucat Ticaret 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.