Correlation Between Koc Holding and Korfez Gayrimenkul

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

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

Diversification Opportunities for Koc Holding and Korfez Gayrimenkul

-0.45

Correlation Coefficient

Koc Holding  Korfez Gayrimenkul

Very good diversification

The 3 months correlation between Koc and Korfez is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holding AS and Korfez Gayrimenkul Yatirim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korfez Gayrimenkul and Koc 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 Koc Holding AS are associated (or correlated) with Korfez Gayrimenkul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korfez Gayrimenkul has no effect on the direction of Koc Holding i.e., Koc Holding and Korfez Gayrimenkul go up and down completely randomly.

Pair Corralation between Koc Holding and Korfez Gayrimenkul

Assuming the 90 days trading horizon Koc Holding AS is expected to under-perform the Korfez Gayrimenkul. But the stock apears to be less risky and, when comparing its historical volatility, Koc Holding AS is 1.67 times less risky than Korfez Gayrimenkul. The stock trades about -0.04 of its potential returns per unit of risk. The Korfez Gayrimenkul Yatirim is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  797.00  in Korfez Gayrimenkul Yatirim on December 29, 2024 and sell it today you would earn a total of  383.00  from holding Korfez Gayrimenkul Yatirim or generate 48.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

Koc Holding AS  vs.  Korfez Gayrimenkul Yatirim

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 latest inconsistent performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Korfez Gayrimenkul

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Korfez Gayrimenkul Yatirim are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Korfez Gayrimenkul demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Koc Holding and Korfez Gayrimenkul

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

The idea behind Koc Holding AS and Korfez 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.

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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.