Correlation Between Galata Wind and Peker Gayrimenkul

Can any of the company-specific risk be diversified away by investing in both Galata Wind and Peker Gayrimenkul 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 Galata Wind and Peker Gayrimenkul into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Galata Wind Enerji and Peker Gayrimenkul Yatirim, you can compare the effects of market volatilities on Galata Wind and Peker Gayrimenkul 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 Galata Wind with a short position of Peker Gayrimenkul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galata Wind and Peker Gayrimenkul.

Diversification Opportunities for Galata Wind and Peker Gayrimenkul

0.9

Correlation Coefficient

Galata Wind  Peker Gayrimenkul

Almost no diversification

The 3 months correlation between Galata and Peker is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Galata Wind Enerji and Peker Gayrimenkul Yatirim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peker Gayrimenkul Yatirim and Galata Wind 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 Galata Wind Enerji are associated (or correlated) with Peker Gayrimenkul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peker Gayrimenkul Yatirim has no effect on the direction of Galata Wind i.e., Galata Wind and Peker Gayrimenkul go up and down completely randomly.

Pair Corralation between Galata Wind and Peker Gayrimenkul

Assuming the 90 days trading horizon Galata Wind is expected to generate 3.56 times less return on investment than Peker Gayrimenkul. But when comparing it to its historical volatility, Galata Wind Enerji is 4.27 times less risky than Peker Gayrimenkul. It trades about 0.05 of its potential returns per unit of risk. Peker Gayrimenkul Yatirim is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  87.00  in Peker Gayrimenkul Yatirim on October 5, 2024 and sell it today you would earn a total of  64.00  from holding Peker Gayrimenkul Yatirim or generate 73.56% return on investment over 90 days.

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

Galata Wind Enerji  vs.  Peker Gayrimenkul Yatirim

Galata Wind Enerji

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Galata Wind Enerji are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Galata Wind demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Peker Gayrimenkul Yatirim

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Peker Gayrimenkul Yatirim are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Peker Gayrimenkul demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Galata Wind and Peker Gayrimenkul

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

The idea behind Galata Wind Enerji and Peker Gayrimenkul Yatirim 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.