Correlation Between Gentas Genel and Global Yatirim

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

By analyzing existing cross correlation between Gentas Genel Metal and Global Yatirim Holding, you can compare the effects of market volatilities on Gentas Genel and Global 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 Gentas Genel with a short position of Global Yatirim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gentas Genel and Global Yatirim.

Diversification Opportunities for Gentas Genel and Global Yatirim

0.57

Correlation Coefficient

Gentas Genel  Global Yatirim

Very weak diversification

The 3 months correlation between Gentas and Global is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Gentas Genel Metal and Global Yatirim Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Yatirim Holding and Gentas Genel 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 Gentas Genel Metal are associated (or correlated) with Global Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Yatirim Holding has no effect on the direction of Gentas Genel i.e., Gentas Genel and Global Yatirim go up and down completely randomly.

Pair Corralation between Gentas Genel and Global Yatirim

Assuming the 90 days trading horizon Gentas Genel Metal is expected to generate 1.04 times more return on investment than Global Yatirim. However, Gentas Genel is 1.04 times more volatile than Global Yatirim Holding. It trades about 0.2 of its potential returns per unit of risk. Global Yatirim Holding is currently generating about 0.12 per unit of risk. If you would invest  959.00  in Gentas Genel Metal on December 23, 2024 and sell it today you would earn a total of  475.00  from holding Gentas Genel Metal or generate 49.53% return on investment over 90 days.

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

Gentas Genel Metal  vs.  Global Yatirim Holding

Gentas Genel Metal

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gentas Genel Metal are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Gentas Genel demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Global Yatirim Holding

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global Yatirim Holding are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Global Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gentas Genel and Global Yatirim

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

The idea behind Gentas Genel Metal and Global Yatirim Holding 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.