Correlation Between Eregli Demir and Is Yatirim

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

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

Diversification Opportunities for Eregli Demir and Is Yatirim

0.69

Correlation Coefficient

Eregli Demir  Is Yatirim

Poor diversification

The 3 months correlation between Eregli and ISMEN is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Eregli Demir ve and Is Yatirim Menkul in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Is Yatirim Menkul and Eregli Demir 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 Eregli Demir ve are associated (or correlated) with Is Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Is Yatirim Menkul has no effect on the direction of Eregli Demir i.e., Eregli Demir and Is Yatirim go up and down completely randomly.

Pair Corralation between Eregli Demir and Is Yatirim

Assuming the 90 days trading horizon Eregli Demir is expected to generate 5.34 times less return on investment than Is Yatirim. But when comparing it to its historical volatility, Eregli Demir ve is 2.9 times less risky than Is Yatirim. It trades about 0.03 of its potential returns per unit of risk. Is Yatirim Menkul is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1,040  in Is Yatirim Menkul on October 4, 2024 and sell it today you would earn a total of  3,700  from holding Is Yatirim Menkul or generate 355.77% return on investment over 90 days.

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

Eregli Demir ve  vs.  Is Yatirim Menkul

Eregli Demir ve

Risk-Adjusted Performance

0 of 100

Very Weak

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

Is Yatirim Menkul

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Is Yatirim Menkul are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Is Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eregli Demir and Is Yatirim

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

The idea behind Eregli Demir ve and Is Yatirim Menkul 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.