Correlation Between Burcelik Vana and Bursa Cimento

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

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

Diversification Opportunities for Burcelik Vana and Bursa Cimento

-0.88

Correlation Coefficient

Burcelik Vana  Bursa Cimento

Pay attention - limited upside

The 3 months correlation between Burcelik and Bursa is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Burcelik Vana Sanayi and Bursa Cimento Fabrikasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bursa Cimento Fabrikasi and Burcelik Vana 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 Vana Sanayi are associated (or correlated) with Bursa Cimento. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bursa Cimento Fabrikasi has no effect on the direction of Burcelik Vana i.e., Burcelik Vana and Bursa Cimento go up and down completely randomly.

Pair Corralation between Burcelik Vana and Bursa Cimento

Assuming the 90 days trading horizon Burcelik Vana Sanayi is expected to generate 1.72 times more return on investment than Bursa Cimento. However, Burcelik Vana is 1.72 times more volatile than Bursa Cimento Fabrikasi. It trades about 0.04 of its potential returns per unit of risk. Bursa Cimento Fabrikasi is currently generating about 0.06 per unit of risk. If you would invest  7,715  in Burcelik Vana Sanayi on October 12, 2024 and sell it today you would earn a total of  3,245  from holding Burcelik Vana Sanayi or generate 42.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	99.74%
Values	Daily Returns

Burcelik Vana Sanayi  vs.  Bursa Cimento Fabrikasi

Burcelik Vana Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Burcelik Vana Sanayi 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.

Bursa Cimento Fabrikasi

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bursa Cimento Fabrikasi are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Bursa Cimento demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Burcelik Vana and Bursa Cimento

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

The idea behind Burcelik Vana Sanayi and Bursa Cimento Fabrikasi 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.