Correlation Between Seyitler Kimya and Anatolia Tani

Can any of the company-specific risk be diversified away by investing in both Seyitler Kimya and Anatolia Tani 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 Seyitler Kimya and Anatolia Tani into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Seyitler Kimya Sanayi and Anatolia Tani ve, you can compare the effects of market volatilities on Seyitler Kimya and Anatolia Tani 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 Seyitler Kimya with a short position of Anatolia Tani. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seyitler Kimya and Anatolia Tani.

Diversification Opportunities for Seyitler Kimya and Anatolia Tani

0.83

Correlation Coefficient

Seyitler Kimya  Anatolia Tani

Very poor diversification

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

Pair Corralation between Seyitler Kimya and Anatolia Tani

Assuming the 90 days trading horizon Seyitler Kimya Sanayi is expected to under-perform the Anatolia Tani. In addition to that, Seyitler Kimya is 1.62 times more volatile than Anatolia Tani ve. It trades about -0.33 of its total potential returns per unit of risk. Anatolia Tani ve is currently generating about -0.23 per unit of volatility. If you would invest  1,410  in Anatolia Tani ve on October 7, 2024 and sell it today you would lose (161.00) from holding Anatolia Tani ve or give up 11.42% of portfolio value over 90 days.

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

Seyitler Kimya Sanayi  vs.  Anatolia Tani ve

Seyitler Kimya Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Seyitler Kimya Sanayi 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.

Anatolia Tani ve

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anatolia Tani ve 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.

Pair Trading with Seyitler Kimya and Anatolia Tani

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

The idea behind Seyitler Kimya Sanayi and Anatolia Tani ve 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.