Correlation Between Bosch Fren and Celik Halat

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

By analyzing existing cross correlation between Bosch Fren Sistemleri and Celik Halat ve, you can compare the effects of market volatilities on Bosch Fren and Celik Halat 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 Bosch Fren with a short position of Celik Halat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bosch Fren and Celik Halat.

Diversification Opportunities for Bosch Fren and Celik Halat

0.01

Correlation Coefficient

Bosch Fren  Celik Halat

Significant diversification

The 3 months correlation between Bosch and Celik is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Bosch Fren Sistemleri and Celik Halat ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celik Halat ve and Bosch Fren 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 Bosch Fren Sistemleri are associated (or correlated) with Celik Halat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celik Halat ve has no effect on the direction of Bosch Fren i.e., Bosch Fren and Celik Halat go up and down completely randomly.

Pair Corralation between Bosch Fren and Celik Halat

Assuming the 90 days trading horizon Bosch Fren Sistemleri is expected to generate 0.91 times more return on investment than Celik Halat. However, Bosch Fren Sistemleri is 1.1 times less risky than Celik Halat. It trades about -0.03 of its potential returns per unit of risk. Celik Halat ve is currently generating about -0.21 per unit of risk. If you would invest  73,500  in Bosch Fren Sistemleri on September 23, 2024 and sell it today you would lose (5,450) from holding Bosch Fren Sistemleri or give up 7.41% of portfolio value over 90 days.

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

Bosch Fren Sistemleri  vs.  Celik Halat ve

Bosch Fren Sistemleri

Risk-Adjusted Performance

0 of 100

Very Weak

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

Celik Halat ve

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Celik Halat ve has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Bosch Fren and Celik Halat

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

The idea behind Bosch Fren Sistemleri and Celik Halat ve 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.