Correlation Between Migros Ticaret and Turkiye Sise

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

By analyzing existing cross correlation between Migros Ticaret AS and Turkiye Sise ve, you can compare the effects of market volatilities on Migros Ticaret and Turkiye Sise 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 Migros Ticaret with a short position of Turkiye Sise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Migros Ticaret and Turkiye Sise.

Diversification Opportunities for Migros Ticaret and Turkiye Sise

0.79

Correlation Coefficient

Migros Ticaret  Turkiye Sise

Poor diversification

The 3 months correlation between Migros and Turkiye is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Migros Ticaret AS and Turkiye Sise ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkiye Sise ve and Migros Ticaret 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 Migros Ticaret AS are associated (or correlated) with Turkiye Sise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkiye Sise ve has no effect on the direction of Migros Ticaret i.e., Migros Ticaret and Turkiye Sise go up and down completely randomly.

Pair Corralation between Migros Ticaret and Turkiye Sise

Assuming the 90 days trading horizon Migros Ticaret is expected to generate 1.83 times less return on investment than Turkiye Sise. But when comparing it to its historical volatility, Migros Ticaret AS is 1.17 times less risky than Turkiye Sise. It trades about 0.12 of its potential returns per unit of risk. Turkiye Sise ve is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  4,104  in Turkiye Sise ve on September 24, 2024 and sell it today you would earn a total of  256.00  from holding Turkiye Sise ve or generate 6.24% return on investment over 90 days.

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

Migros Ticaret AS  vs.  Turkiye Sise ve

Migros Ticaret AS

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Migros Ticaret AS are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Migros Ticaret is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Turkiye Sise ve

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Turkiye Sise ve are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Turkiye Sise is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Migros Ticaret and Turkiye Sise

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

The idea behind Migros Ticaret AS and Turkiye Sise ve 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..