Correlation Between Burcelik Bursa and Koc Holding

Can any of the company-specific risk be diversified away by investing in both Burcelik Bursa and Koc Holding 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 Burcelik Bursa and Koc Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Burcelik Bursa Celik and Koc Holding AS, you can compare the effects of market volatilities on Burcelik Bursa and Koc Holding 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 Burcelik Bursa with a short position of Koc Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burcelik Bursa and Koc Holding.

Diversification Opportunities for Burcelik Bursa and Koc Holding

-0.48

Correlation Coefficient

Burcelik Bursa  Koc Holding

Very good diversification

The 3 months correlation between Burcelik and Koc is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Burcelik Bursa Celik and Koc Holding AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koc Holding AS and Burcelik Bursa 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 Burcelik Bursa Celik are associated (or correlated) with Koc Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koc Holding AS has no effect on the direction of Burcelik Bursa i.e., Burcelik Bursa and Koc Holding go up and down completely randomly.

Pair Corralation between Burcelik Bursa and Koc Holding

Assuming the 90 days trading horizon Burcelik Bursa Celik is expected to generate 1.76 times more return on investment than Koc Holding. However, Burcelik Bursa is 1.76 times more volatile than Koc Holding AS. It trades about 0.03 of its potential returns per unit of risk. Koc Holding AS is currently generating about -0.2 per unit of risk. If you would invest  1,836  in Burcelik Bursa Celik on October 15, 2024 and sell it today you would earn a total of  16.00  from holding Burcelik Bursa Celik or generate 0.87% return on investment over 90 days.

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

Burcelik Bursa Celik  vs.  Koc Holding AS

Burcelik Bursa Celik

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Burcelik Bursa Celik 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 February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Koc Holding AS

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Koc Holding AS are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Koc Holding is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Burcelik Bursa and Koc Holding

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

The idea behind Burcelik Bursa Celik and Koc Holding 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.