Correlation Between Turkiye Is and Koc Holding

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

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

Diversification Opportunities for Turkiye Is and Koc Holding

0.39

Correlation Coefficient

Turkiye Is  Koc Holding

Weak diversification

The 3 months correlation between Turkiye and Koc is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Is Bankasi and Koc Holding AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koc Holding AS and Turkiye Is 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 Turkiye Is Bankasi are associated (or correlated) with Koc Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koc Holding AS has no effect on the direction of Turkiye Is i.e., Turkiye Is and Koc Holding go up and down completely randomly.

Pair Corralation between Turkiye Is and Koc Holding

Assuming the 90 days trading horizon Turkiye Is Bankasi is expected to generate 2.01 times more return on investment than Koc Holding. However, Turkiye Is is 2.01 times more volatile than Koc Holding AS. It trades about 0.13 of its potential returns per unit of risk. Koc Holding AS is currently generating about 0.07 per unit of risk. If you would invest  4,409,560  in Turkiye Is Bankasi on December 4, 2024 and sell it today you would earn a total of  48,090,240  from holding Turkiye Is Bankasi or generate 1090.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.58%
Values	Daily Returns

Turkiye Is Bankasi  vs.  Koc Holding AS

Turkiye Is Bankasi

Risk-Adjusted Performance

Very Weak

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

Koc Holding AS

Risk-Adjusted Performance

Very Weak

Over the last 90 days Koc Holding AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Turkiye Is and Koc Holding

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

The idea behind Turkiye Is Bankasi and Koc Holding AS 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.