Correlation Between Ayes Celik and Trabzon Liman

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

By analyzing existing cross correlation between Ayes Celik Hasir and Trabzon Liman Isletmeciligi, you can compare the effects of market volatilities on Ayes Celik and Trabzon Liman 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 Ayes Celik with a short position of Trabzon Liman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ayes Celik and Trabzon Liman.

Diversification Opportunities for Ayes Celik and Trabzon Liman

-0.48

Correlation Coefficient

Ayes Celik  Trabzon Liman

Very good diversification

The 3 months correlation between Ayes and Trabzon is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ayes Celik Hasir and Trabzon Liman Isletmeciligi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trabzon Liman Isletm and Ayes Celik 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 Ayes Celik Hasir are associated (or correlated) with Trabzon Liman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trabzon Liman Isletm has no effect on the direction of Ayes Celik i.e., Ayes Celik and Trabzon Liman go up and down completely randomly.

Pair Corralation between Ayes Celik and Trabzon Liman

Assuming the 90 days trading horizon Ayes Celik Hasir is expected to generate 1.15 times more return on investment than Trabzon Liman. However, Ayes Celik is 1.15 times more volatile than Trabzon Liman Isletmeciligi. It trades about 0.06 of its potential returns per unit of risk. Trabzon Liman Isletmeciligi is currently generating about 0.04 per unit of risk. If you would invest  402.00  in Ayes Celik Hasir on December 4, 2024 and sell it today you would earn a total of  488.00  from holding Ayes Celik Hasir or generate 121.39% return on investment over 90 days.

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

Ayes Celik Hasir  vs.  Trabzon Liman Isletmeciligi

Ayes Celik Hasir

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ayes Celik Hasir are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Ayes Celik may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Trabzon Liman Isletm

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Ayes Celik and Trabzon Liman

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

The idea behind Ayes Celik Hasir and Trabzon Liman Isletmeciligi 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.