Correlation Between Gentas Genel and Galata Wind
Can any of the company-specific risk be diversified away by investing in both Gentas Genel and Galata Wind 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 Galata Wind 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 Galata Wind Enerji, you can compare the effects of market volatilities on Gentas Genel and Galata Wind 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 Galata Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gentas Genel and Galata Wind.
Diversification Opportunities for Gentas Genel and Galata Wind
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gentas and Galata is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Gentas Genel Metal and Galata Wind Enerji in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galata Wind Enerji 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 Galata Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galata Wind Enerji has no effect on the direction of Gentas Genel i.e., Gentas Genel and Galata Wind go up and down completely randomly.
Pair Corralation between Gentas Genel and Galata Wind
Assuming the 90 days trading horizon Gentas Genel Metal is expected to generate 0.88 times more return on investment than Galata Wind. However, Gentas Genel Metal is 1.14 times less risky than Galata Wind. It trades about 0.13 of its potential returns per unit of risk. Galata Wind Enerji is currently generating about 0.09 per unit of risk. If you would invest 814.00 in Gentas Genel Metal on September 17, 2024 and sell it today you would earn a total of 134.00 from holding Gentas Genel Metal or generate 16.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Gentas Genel Metal vs. Galata Wind Enerji
Performance |
Timeline |
Gentas Genel Metal |
Galata Wind Enerji |
Gentas Genel and Galata Wind Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gentas Genel and Galata Wind
The main advantage of trading using opposite Gentas Genel and Galata Wind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gentas Genel position performs unexpectedly, Galata Wind 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 Galata Wind will offset losses from the drop in Galata Wind's long position.Gentas Genel vs. Politeknik Metal Sanayi | Gentas Genel vs. Sekerbank TAS | Gentas Genel vs. Sodas Sodyum Sanayi | Gentas Genel vs. Akbank TAS |
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Check out your portfolio center.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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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