Correlation Between Brisa Bridgestone and Kuyas Yatirim

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

Diversification Opportunities for Brisa Bridgestone and Kuyas Yatirim

0.26

Correlation Coefficient

Brisa Bridgestone  Kuyas Yatirim

Modest diversification

The 3 months correlation between Brisa and Kuyas is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Brisa Bridgestone Sabanci and Kuyas Yatirim AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuyas Yatirim AS 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 Kuyas Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuyas Yatirim AS has no effect on the direction of Brisa Bridgestone i.e., Brisa Bridgestone and Kuyas Yatirim go up and down completely randomly.

Pair Corralation between Brisa Bridgestone and Kuyas Yatirim

Assuming the 90 days trading horizon Brisa Bridgestone is expected to generate 2.11 times less return on investment than Kuyas Yatirim. In addition to that, Brisa Bridgestone is 1.04 times more volatile than Kuyas Yatirim AS. It trades about 0.04 of its total potential returns per unit of risk. Kuyas Yatirim AS is currently generating about 0.08 per unit of volatility. If you would invest  1,621  in Kuyas Yatirim AS on September 13, 2024 and sell it today you would earn a total of  177.00  from holding Kuyas Yatirim AS or generate 10.92% return on investment over 90 days.

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

Brisa Bridgestone Sabanci  vs.  Kuyas Yatirim AS

Brisa Bridgestone Sabanci

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Brisa Bridgestone Sabanci are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Brisa Bridgestone is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Kuyas Yatirim AS

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kuyas Yatirim AS are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Kuyas Yatirim may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Brisa Bridgestone and Kuyas Yatirim

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

The idea behind Brisa Bridgestone Sabanci and Kuyas Yatirim AS 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.