Correlation Between Turkiye Kalkinma and Lokman Hekim

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

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

Diversification Opportunities for Turkiye Kalkinma and Lokman Hekim

-0.55

Correlation Coefficient

Turkiye Kalkinma  Lokman Hekim

Excellent diversification

The 3 months correlation between Turkiye and Lokman is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Kalkinma Bankasi and Lokman Hekim Engurusag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lokman Hekim Engurusag and Turkiye Kalkinma 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 Kalkinma Bankasi are associated (or correlated) with Lokman Hekim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lokman Hekim Engurusag has no effect on the direction of Turkiye Kalkinma i.e., Turkiye Kalkinma and Lokman Hekim go up and down completely randomly.

Pair Corralation between Turkiye Kalkinma and Lokman Hekim

Assuming the 90 days trading horizon Turkiye Kalkinma is expected to generate 37.28 times less return on investment than Lokman Hekim. But when comparing it to its historical volatility, Turkiye Kalkinma Bankasi is 1.51 times less risky than Lokman Hekim. It trades about 0.03 of its potential returns per unit of risk. Lokman Hekim Engurusag is currently generating about 0.74 of returns per unit of risk over similar time horizon. If you would invest  1,650  in Lokman Hekim Engurusag on October 22, 2024 and sell it today you would earn a total of  496.00  from holding Lokman Hekim Engurusag or generate 30.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Turkiye Kalkinma Bankasi  vs.  Lokman Hekim Engurusag

Turkiye Kalkinma Bankasi

Risk-Adjusted Performance

0 of 100

Very Weak

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

Lokman Hekim Engurusag

Risk-Adjusted Performance

29 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Lokman Hekim Engurusag are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Lokman Hekim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Turkiye Kalkinma and Lokman Hekim

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

The idea behind Turkiye Kalkinma Bankasi and Lokman Hekim Engurusag 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.