Correlation Between Morgan Stanley and Derimod Konfeksiyon

Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and Derimod Konfeksiyon 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 Morgan Stanley and Derimod Konfeksiyon into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Morgan Stanley Direct and Derimod Konfeksiyon Ayakkabi, you can compare the effects of market volatilities on Morgan Stanley and Derimod Konfeksiyon 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 Morgan Stanley with a short position of Derimod Konfeksiyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and Derimod Konfeksiyon.

Diversification Opportunities for Morgan Stanley and Derimod Konfeksiyon

0.51

Correlation Coefficient

Morgan Stanley  Derimod Konfeksiyon

Very weak diversification

The 3 months correlation between Morgan and Derimod is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley Direct and Derimod Konfeksiyon Ayakkabi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Derimod Konfeksiyon and Morgan Stanley 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 Morgan Stanley Direct are associated (or correlated) with Derimod Konfeksiyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Derimod Konfeksiyon has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and Derimod Konfeksiyon go up and down completely randomly.

Pair Corralation between Morgan Stanley and Derimod Konfeksiyon

Given the investment horizon of 90 days Morgan Stanley is expected to generate 14.12 times less return on investment than Derimod Konfeksiyon. But when comparing it to its historical volatility, Morgan Stanley Direct is 3.89 times less risky than Derimod Konfeksiyon. It trades about 0.06 of its potential returns per unit of risk. Derimod Konfeksiyon Ayakkabi is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  3,362  in Derimod Konfeksiyon Ayakkabi on October 10, 2024 and sell it today you would earn a total of  600.00  from holding Derimod Konfeksiyon Ayakkabi or generate 17.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Morgan Stanley Direct  vs.  Derimod Konfeksiyon Ayakkabi

Morgan Stanley Direct

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Morgan Stanley Direct are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent fundamental indicators, Morgan Stanley is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Derimod Konfeksiyon

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Derimod Konfeksiyon Ayakkabi are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Derimod Konfeksiyon demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Morgan Stanley and Derimod Konfeksiyon

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

The idea behind Morgan Stanley Direct and Derimod Konfeksiyon Ayakkabi 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.