Correlation Between QNB Finans and Desa Deri

Can any of the company-specific risk be diversified away by investing in both QNB Finans and Desa Deri 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 QNB Finans and Desa Deri into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for QNB Finans and Desa Deri

-0.49

Correlation Coefficient

QNB Finans  Desa Deri

Very good diversification

The 3 months correlation between QNB and Desa is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding QNB Finans Finansal and Desa Deri Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Desa Deri Sanayi and QNB Finans 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 QNB Finans Finansal are associated (or correlated) with Desa Deri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Desa Deri Sanayi has no effect on the direction of QNB Finans i.e., QNB Finans and Desa Deri go up and down completely randomly.

Pair Corralation between QNB Finans and Desa Deri

Assuming the 90 days trading horizon QNB Finans Finansal is expected to under-perform the Desa Deri. In addition to that, QNB Finans is 2.52 times more volatile than Desa Deri Sanayi. It trades about -0.14 of its total potential returns per unit of risk. Desa Deri Sanayi is currently generating about 0.04 per unit of volatility. If you would invest  2,140  in Desa Deri Sanayi on October 7, 2024 and sell it today you would earn a total of  28.00  from holding Desa Deri Sanayi or generate 1.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

QNB Finans Finansal  vs.  Desa Deri Sanayi

QNB Finans Finansal

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days QNB Finans Finansal 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 February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Desa Deri Sanayi

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Desa Deri Sanayi are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Desa Deri 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 QNB Finans and Desa Deri

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

The idea behind QNB Finans Finansal and Desa Deri 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.