Correlation Between Petrokent Turizm and Koza Anadolu

Can any of the company-specific risk be diversified away by investing in both Petrokent Turizm and Koza Anadolu 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 Petrokent Turizm and Koza Anadolu into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Petrokent Turizm AS and Koza Anadolu Metal, you can compare the effects of market volatilities on Petrokent Turizm and Koza Anadolu 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 Petrokent Turizm with a short position of Koza Anadolu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrokent Turizm and Koza Anadolu.

Diversification Opportunities for Petrokent Turizm and Koza Anadolu

-0.37

Correlation Coefficient

Petrokent Turizm  Koza Anadolu

Very good diversification

The 3 months correlation between Petrokent and Koza is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Petrokent Turizm AS and Koza Anadolu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koza Anadolu Metal and Petrokent Turizm 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 Petrokent Turizm AS are associated (or correlated) with Koza Anadolu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koza Anadolu Metal has no effect on the direction of Petrokent Turizm i.e., Petrokent Turizm and Koza Anadolu go up and down completely randomly.

Pair Corralation between Petrokent Turizm and Koza Anadolu

Assuming the 90 days trading horizon Petrokent Turizm AS is expected to under-perform the Koza Anadolu. But the stock apears to be less risky and, when comparing its historical volatility, Petrokent Turizm AS is 1.26 times less risky than Koza Anadolu. The stock trades about -0.18 of its potential returns per unit of risk. The Koza Anadolu Metal is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  7,070  in Koza Anadolu Metal on December 29, 2024 and sell it today you would earn a total of  1,605  from holding Koza Anadolu Metal or generate 22.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Petrokent Turizm AS  vs.  Koza Anadolu Metal

Petrokent Turizm

Risk-Adjusted Performance

Very Weak

Over the last 90 days Petrokent Turizm AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Koza Anadolu Metal

Risk-Adjusted Performance

OK

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

Pair Trading with Petrokent Turizm and Koza Anadolu

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

The idea behind Petrokent Turizm AS and Koza Anadolu Metal 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.