Correlation Between Penguen Gida and Is Finansal

Can any of the company-specific risk be diversified away by investing in both Penguen Gida and Is Finansal 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 Penguen Gida and Is Finansal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Penguen Gida Sanayi and Is Finansal Kiralama, you can compare the effects of market volatilities on Penguen Gida and Is Finansal 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 Penguen Gida with a short position of Is Finansal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penguen Gida and Is Finansal.

Diversification Opportunities for Penguen Gida and Is Finansal

0.83

Correlation Coefficient

Penguen Gida  Is Finansal

Very poor diversification

The 3 months correlation between Penguen and ISFIN is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Penguen Gida Sanayi and Is Finansal Kiralama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Is Finansal Kiralama and Penguen Gida 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 Penguen Gida Sanayi are associated (or correlated) with Is Finansal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Is Finansal Kiralama has no effect on the direction of Penguen Gida i.e., Penguen Gida and Is Finansal go up and down completely randomly.

Pair Corralation between Penguen Gida and Is Finansal

Assuming the 90 days trading horizon Penguen Gida is expected to generate 6.05 times less return on investment than Is Finansal. But when comparing it to its historical volatility, Penguen Gida Sanayi is 1.16 times less risky than Is Finansal. It trades about 0.06 of its potential returns per unit of risk. Is Finansal Kiralama is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest  1,103  in Is Finansal Kiralama on September 22, 2024 and sell it today you would earn a total of  152.00  from holding Is Finansal Kiralama or generate 13.78% return on investment over 90 days.

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

Penguen Gida Sanayi  vs.  Is Finansal Kiralama

Penguen Gida Sanayi

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Penguen Gida Sanayi are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Penguen Gida is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Is Finansal Kiralama

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Is Finansal Kiralama are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Is Finansal may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Penguen Gida and Is Finansal

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

The idea behind Penguen Gida Sanayi and Is Finansal Kiralama 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.