Correlation Between KOC METALURJI and Global Yatirim

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

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

Diversification Opportunities for KOC METALURJI and Global Yatirim

0.41

Correlation Coefficient

KOC METALURJI  Global Yatirim

Very weak diversification

The 3 months correlation between KOC and Global is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding KOC METALURJI and Global Yatirim Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Yatirim Holding and KOC METALURJI 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 METALURJI are associated (or correlated) with Global Yatirim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Yatirim Holding has no effect on the direction of KOC METALURJI i.e., KOC METALURJI and Global Yatirim go up and down completely randomly.

Pair Corralation between KOC METALURJI and Global Yatirim

Assuming the 90 days trading horizon KOC METALURJI is expected to under-perform the Global Yatirim. In addition to that, KOC METALURJI is 1.02 times more volatile than Global Yatirim Holding. It trades about -0.05 of its total potential returns per unit of risk. Global Yatirim Holding is currently generating about 0.07 per unit of volatility. If you would invest  829.00  in Global Yatirim Holding on October 23, 2024 and sell it today you would earn a total of  1,031  from holding Global Yatirim Holding or generate 124.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	34.34%
Values	Daily Returns

KOC METALURJI  vs.  Global Yatirim Holding

KOC METALURJI

Risk-Adjusted Performance

0 of 100

Very Weak

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

Global Yatirim Holding

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global Yatirim Holding are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Global Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KOC METALURJI and Global Yatirim

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

The idea behind KOC METALURJI and Global Yatirim Holding 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.