Correlation Between Is Yatirim and Derimod Konfeksiyon

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

By analyzing existing cross correlation between Is Yatirim Menkul and Derimod Konfeksiyon Ayakkabi, you can compare the effects of market volatilities on Is Yatirim and Derimod Konfeksiyon 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 Is Yatirim with a short position of Derimod Konfeksiyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Is Yatirim and Derimod Konfeksiyon.

Diversification Opportunities for Is Yatirim and Derimod Konfeksiyon

0.56

Correlation Coefficient

Is Yatirim  Derimod Konfeksiyon

Very weak diversification

The 3 months correlation between ISMEN and Derimod is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Is Yatirim Menkul and Derimod Konfeksiyon Ayakkabi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Derimod Konfeksiyon and Is Yatirim 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 Is Yatirim Menkul are associated (or correlated) with Derimod Konfeksiyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Derimod Konfeksiyon has no effect on the direction of Is Yatirim i.e., Is Yatirim and Derimod Konfeksiyon go up and down completely randomly.

Pair Corralation between Is Yatirim and Derimod Konfeksiyon

Assuming the 90 days trading horizon Is Yatirim is expected to generate 2.31 times less return on investment than Derimod Konfeksiyon. But when comparing it to its historical volatility, Is Yatirim Menkul is 1.62 times less risky than Derimod Konfeksiyon. It trades about 0.08 of its potential returns per unit of risk. Derimod Konfeksiyon Ayakkabi is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,550  in Derimod Konfeksiyon Ayakkabi on October 5, 2024 and sell it today you would earn a total of  2,428  from holding Derimod Konfeksiyon Ayakkabi or generate 156.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.6%
Values	Daily Returns

Is Yatirim Menkul  vs.  Derimod Konfeksiyon Ayakkabi

Is Yatirim Menkul

Risk-Adjusted Performance

16 of 100

Solid

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

Derimod Konfeksiyon

Risk-Adjusted Performance

11 of 100

Good

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

Pair Trading with Is Yatirim and Derimod Konfeksiyon

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

The idea behind Is Yatirim Menkul and Derimod Konfeksiyon Ayakkabi 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.