Correlation Between Penguen Gida and Jantsa Jant

Can any of the company-specific risk be diversified away by investing in both Penguen Gida and Jantsa Jant 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 Jantsa Jant 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 Jantsa Jant Sanayi, you can compare the effects of market volatilities on Penguen Gida and Jantsa Jant 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 Jantsa Jant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penguen Gida and Jantsa Jant.

Diversification Opportunities for Penguen Gida and Jantsa Jant

-0.26

Correlation Coefficient

Penguen Gida  Jantsa Jant

Very good diversification

The 3 months correlation between Penguen and Jantsa is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Penguen Gida Sanayi and Jantsa Jant Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jantsa Jant Sanayi 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 Jantsa Jant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jantsa Jant Sanayi has no effect on the direction of Penguen Gida i.e., Penguen Gida and Jantsa Jant go up and down completely randomly.

Pair Corralation between Penguen Gida and Jantsa Jant

Assuming the 90 days trading horizon Penguen Gida is expected to generate 37.29 times less return on investment than Jantsa Jant. But when comparing it to its historical volatility, Penguen Gida Sanayi is 9.27 times less risky than Jantsa Jant. It trades about 0.01 of its potential returns per unit of risk. Jantsa Jant Sanayi is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,495  in Jantsa Jant Sanayi on October 4, 2024 and sell it today you would earn a total of  1,143  from holding Jantsa Jant Sanayi or generate 76.45% return on investment over 90 days.

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

Penguen Gida Sanayi  vs.  Jantsa Jant Sanayi

Penguen Gida Sanayi

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Penguen Gida Sanayi are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Penguen Gida demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Jantsa Jant Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Penguen Gida and Jantsa Jant

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

The idea behind Penguen Gida Sanayi and Jantsa Jant Sanayi 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.