Correlation Between Ihlas Holding and Mazhar Zorlu

Can any of the company-specific risk be diversified away by investing in both Ihlas Holding and Mazhar Zorlu 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 Ihlas Holding and Mazhar Zorlu into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ihlas Holding AS and Mazhar Zorlu Holding, you can compare the effects of market volatilities on Ihlas Holding and Mazhar Zorlu 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 Ihlas Holding with a short position of Mazhar Zorlu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihlas Holding and Mazhar Zorlu.

Diversification Opportunities for Ihlas Holding and Mazhar Zorlu

0.64

Correlation Coefficient

Ihlas Holding  Mazhar Zorlu

Poor diversification

The 3 months correlation between Ihlas and Mazhar is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ihlas Holding AS and Mazhar Zorlu Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mazhar Zorlu Holding and Ihlas Holding 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 Ihlas Holding AS are associated (or correlated) with Mazhar Zorlu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mazhar Zorlu Holding has no effect on the direction of Ihlas Holding i.e., Ihlas Holding and Mazhar Zorlu go up and down completely randomly.

Pair Corralation between Ihlas Holding and Mazhar Zorlu

Assuming the 90 days trading horizon Ihlas Holding AS is expected to generate 1.7 times more return on investment than Mazhar Zorlu. However, Ihlas Holding is 1.7 times more volatile than Mazhar Zorlu Holding. It trades about 0.14 of its potential returns per unit of risk. Mazhar Zorlu Holding is currently generating about -0.03 per unit of risk. If you would invest  106.00  in Ihlas Holding AS on October 10, 2024 and sell it today you would earn a total of  241.00  from holding Ihlas Holding AS or generate 227.36% return on investment over 90 days.

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

Ihlas Holding AS  vs.  Mazhar Zorlu Holding

Ihlas Holding AS

Risk-Adjusted Performance

28 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Ihlas Holding AS are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Ihlas Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Mazhar Zorlu Holding

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mazhar Zorlu Holding are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, Mazhar Zorlu may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Ihlas Holding and Mazhar Zorlu

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

The idea behind Ihlas Holding AS and Mazhar Zorlu 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.