Correlation Between Lokman Hekim and Sekerbank TAS

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

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

Diversification Opportunities for Lokman Hekim and Sekerbank TAS

0.76

Correlation Coefficient

Lokman Hekim  Sekerbank TAS

Poor diversification

The 3 months correlation between Lokman and Sekerbank is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Lokman Hekim Engurusag and Sekerbank TAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sekerbank TAS and Lokman Hekim 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 Lokman Hekim Engurusag are associated (or correlated) with Sekerbank TAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sekerbank TAS has no effect on the direction of Lokman Hekim i.e., Lokman Hekim and Sekerbank TAS go up and down completely randomly.

Pair Corralation between Lokman Hekim and Sekerbank TAS

Assuming the 90 days trading horizon Lokman Hekim Engurusag is expected to generate 0.81 times more return on investment than Sekerbank TAS. However, Lokman Hekim Engurusag is 1.23 times less risky than Sekerbank TAS. It trades about 0.12 of its potential returns per unit of risk. Sekerbank TAS is currently generating about 0.04 per unit of risk. If you would invest  1,583  in Lokman Hekim Engurusag on October 22, 2024 and sell it today you would earn a total of  563.00  from holding Lokman Hekim Engurusag or generate 35.57% return on investment over 90 days.

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

Lokman Hekim Engurusag  vs.  Sekerbank TAS

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.

Sekerbank TAS

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sekerbank TAS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Sekerbank TAS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Lokman Hekim and Sekerbank TAS

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

The idea behind Lokman Hekim Engurusag and Sekerbank TAS 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.