Correlation Between Bosch Fren and Gedik Yatirim

Can any of the company-specific risk be diversified away by investing in both Bosch Fren and Gedik 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 Bosch Fren and Gedik Yatirim 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 Gedik Yatirim Menkul, you can compare the effects of market volatilities on Bosch Fren and Gedik 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 Bosch Fren with a short position of Gedik Yatirim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bosch Fren and Gedik Yatirim.

Diversification Opportunities for Bosch Fren and Gedik Yatirim

0.03

Correlation Coefficient

Bosch Fren  Gedik Yatirim

Significant diversification

The 3 months correlation between Bosch and Gedik is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Bosch Fren Sistemleri and Gedik Yatirim Menkul in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gedik Yatirim Menkul 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 Gedik Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gedik Yatirim Menkul has no effect on the direction of Bosch Fren i.e., Bosch Fren and Gedik Yatirim go up and down completely randomly.

Pair Corralation between Bosch Fren and Gedik Yatirim

Assuming the 90 days trading horizon Bosch Fren Sistemleri is expected to under-perform the Gedik Yatirim. In addition to that, Bosch Fren is 1.12 times more volatile than Gedik Yatirim Menkul. It trades about -0.02 of its total potential returns per unit of risk. Gedik Yatirim Menkul is currently generating about 0.19 per unit of volatility. If you would invest  619.00  in Gedik Yatirim Menkul on September 12, 2024 and sell it today you would earn a total of  185.00  from holding Gedik Yatirim Menkul or generate 29.89% return on investment over 90 days.

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

Bosch Fren Sistemleri  vs.  Gedik Yatirim Menkul

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.

Gedik Yatirim Menkul

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gedik Yatirim Menkul are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Gedik Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bosch Fren and Gedik Yatirim

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

The idea behind Bosch Fren Sistemleri and Gedik Yatirim Menkul 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.