Correlation Between Brisa Bridgestone and Bayrak EBT

Can any of the company-specific risk be diversified away by investing in both Brisa Bridgestone and Bayrak EBT 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 Brisa Bridgestone and Bayrak EBT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brisa Bridgestone Sabanci and Bayrak EBT Taban, you can compare the effects of market volatilities on Brisa Bridgestone and Bayrak EBT 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 Brisa Bridgestone with a short position of Bayrak EBT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brisa Bridgestone and Bayrak EBT.

Diversification Opportunities for Brisa Bridgestone and Bayrak EBT

-0.06

Correlation Coefficient

Brisa Bridgestone  Bayrak EBT

Good diversification

The 3 months correlation between Brisa and Bayrak is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Brisa Bridgestone Sabanci and Bayrak EBT Taban in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayrak EBT Taban and Brisa Bridgestone 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 Brisa Bridgestone Sabanci are associated (or correlated) with Bayrak EBT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayrak EBT Taban has no effect on the direction of Brisa Bridgestone i.e., Brisa Bridgestone and Bayrak EBT go up and down completely randomly.

Pair Corralation between Brisa Bridgestone and Bayrak EBT

Assuming the 90 days trading horizon Brisa Bridgestone Sabanci is expected to generate 0.72 times more return on investment than Bayrak EBT. However, Brisa Bridgestone Sabanci is 1.38 times less risky than Bayrak EBT. It trades about 0.06 of its potential returns per unit of risk. Bayrak EBT Taban is currently generating about -0.01 per unit of risk. If you would invest  8,520  in Brisa Bridgestone Sabanci on October 6, 2024 and sell it today you would earn a total of  585.00  from holding Brisa Bridgestone Sabanci or generate 6.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Brisa Bridgestone Sabanci  vs.  Bayrak EBT Taban

Brisa Bridgestone Sabanci

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Brisa Bridgestone Sabanci are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, Brisa Bridgestone may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Bayrak EBT Taban

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Brisa Bridgestone and Bayrak EBT

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

The idea behind Brisa Bridgestone Sabanci and Bayrak EBT Taban 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.