Correlation Between Borusan Yatirim and Cemtas Celik

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

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

Diversification Opportunities for Borusan Yatirim and Cemtas Celik

0.76

Correlation Coefficient

Borusan Yatirim  Cemtas Celik

Poor diversification

The 3 months correlation between Borusan and Cemtas is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Borusan Yatirim ve and Cemtas Celik Makina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cemtas Celik Makina and Borusan Yatirim 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 Borusan Yatirim ve are associated (or correlated) with Cemtas Celik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cemtas Celik Makina has no effect on the direction of Borusan Yatirim i.e., Borusan Yatirim and Cemtas Celik go up and down completely randomly.

Pair Corralation between Borusan Yatirim and Cemtas Celik

Assuming the 90 days trading horizon Borusan Yatirim is expected to generate 2.64 times less return on investment than Cemtas Celik. But when comparing it to its historical volatility, Borusan Yatirim ve is 4.35 times less risky than Cemtas Celik. It trades about 0.05 of its potential returns per unit of risk. Cemtas Celik Makina is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,295  in Cemtas Celik Makina on September 23, 2024 and sell it today you would lose (402.00) from holding Cemtas Celik Makina or give up 31.04% of portfolio value over 90 days.

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

Borusan Yatirim ve  vs.  Cemtas Celik Makina

Borusan Yatirim ve

Risk-Adjusted Performance

6 of 100

Modest

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

Cemtas Celik Makina

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Borusan Yatirim and Cemtas Celik

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

The idea behind Borusan Yatirim ve and Cemtas Celik Makina 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.