Correlation Between Qnb Finansbank and Turk Tuborg

Can any of the company-specific risk be diversified away by investing in both Qnb Finansbank and Turk Tuborg 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 Finansbank and Turk Tuborg into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Qnb Finansbank AS and Turk Tuborg Bira, you can compare the effects of market volatilities on Qnb Finansbank and Turk Tuborg 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 Finansbank with a short position of Turk Tuborg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qnb Finansbank and Turk Tuborg.

Diversification Opportunities for Qnb Finansbank and Turk Tuborg

-0.41

Correlation Coefficient

Qnb Finansbank  Turk Tuborg

Very good diversification

The 3 months correlation between Qnb and Turk is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Qnb Finansbank AS and Turk Tuborg Bira in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turk Tuborg Bira and Qnb Finansbank 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 Finansbank AS are associated (or correlated) with Turk Tuborg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turk Tuborg Bira has no effect on the direction of Qnb Finansbank i.e., Qnb Finansbank and Turk Tuborg go up and down completely randomly.

Pair Corralation between Qnb Finansbank and Turk Tuborg

Assuming the 90 days trading horizon Qnb Finansbank AS is expected to under-perform the Turk Tuborg. But the stock apears to be less risky and, when comparing its historical volatility, Qnb Finansbank AS is 2.72 times less risky than Turk Tuborg. The stock trades about -0.29 of its potential returns per unit of risk. The Turk Tuborg Bira is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest  14,700  in Turk Tuborg Bira on October 8, 2024 and sell it today you would lose (800.00) from holding Turk Tuborg Bira or give up 5.44% of portfolio value over 90 days.

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

Qnb Finansbank AS  vs.  Turk Tuborg Bira

Qnb Finansbank AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Qnb Finansbank AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Turk Tuborg Bira

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Turk Tuborg Bira are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Turk Tuborg may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Qnb Finansbank and Turk Tuborg

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

The idea behind Qnb Finansbank AS and Turk Tuborg Bira 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.