Correlation Between Koc Holding and Verusaturk Girisim

Can any of the company-specific risk be diversified away by investing in both Koc Holding and Verusaturk Girisim 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 Verusaturk Girisim 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 Verusaturk Girisim Sermayesi, you can compare the effects of market volatilities on Koc Holding and Verusaturk Girisim 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 Verusaturk Girisim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koc Holding and Verusaturk Girisim.

Diversification Opportunities for Koc Holding and Verusaturk Girisim

0.14

Correlation Coefficient

Koc Holding  Verusaturk Girisim

Average diversification

The 3 months correlation between Koc and Verusaturk is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Koc Holding AS and Verusaturk Girisim Sermayesi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Verusaturk Girisim 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 Verusaturk Girisim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Verusaturk Girisim has no effect on the direction of Koc Holding i.e., Koc Holding and Verusaturk Girisim go up and down completely randomly.

Pair Corralation between Koc Holding and Verusaturk Girisim

Assuming the 90 days trading horizon Koc Holding AS is expected to generate 0.75 times more return on investment than Verusaturk Girisim. However, Koc Holding AS is 1.34 times less risky than Verusaturk Girisim. It trades about 0.1 of its potential returns per unit of risk. Verusaturk Girisim Sermayesi is currently generating about 0.04 per unit of risk. If you would invest  6,895  in Koc Holding AS on October 6, 2024 and sell it today you would earn a total of  11,755  from holding Koc Holding AS or generate 170.49% return on investment over 90 days.

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

Koc Holding AS  vs.  Verusaturk Girisim Sermayesi

Koc Holding AS

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Koc Holding AS are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Koc Holding is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Verusaturk Girisim

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Verusaturk Girisim Sermayesi 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.

Pair Trading with Koc Holding and Verusaturk Girisim

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

The idea behind Koc Holding AS and Verusaturk Girisim Sermayesi 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.