Correlation Between Turkiye Sise and Aygaz AS

Can any of the company-specific risk be diversified away by investing in both Turkiye Sise and Aygaz AS 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 Turkiye Sise and Aygaz AS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Turkiye Sise ve and Aygaz AS, you can compare the effects of market volatilities on Turkiye Sise and Aygaz AS 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 Turkiye Sise with a short position of Aygaz AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turkiye Sise and Aygaz AS.

Diversification Opportunities for Turkiye Sise and Aygaz AS

0.85

Correlation Coefficient

Turkiye Sise  Aygaz AS

Very poor diversification

The 3 months correlation between Turkiye and Aygaz is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Sise ve and Aygaz AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aygaz AS and Turkiye Sise 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 Turkiye Sise ve are associated (or correlated) with Aygaz AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aygaz AS has no effect on the direction of Turkiye Sise i.e., Turkiye Sise and Aygaz AS go up and down completely randomly.

Pair Corralation between Turkiye Sise and Aygaz AS

Assuming the 90 days trading horizon Turkiye Sise ve is expected to under-perform the Aygaz AS. In addition to that, Turkiye Sise is 1.16 times more volatile than Aygaz AS. It trades about -0.06 of its total potential returns per unit of risk. Aygaz AS is currently generating about 0.03 per unit of volatility. If you would invest  16,500  in Aygaz AS on December 30, 2024 and sell it today you would earn a total of  380.00  from holding Aygaz AS or generate 2.3% return on investment over 90 days.

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

Turkiye Sise ve  vs.  Aygaz AS

Turkiye Sise ve

Risk-Adjusted Performance

Very Weak

Over the last 90 days Turkiye Sise ve has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Aygaz AS

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aygaz AS are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Aygaz AS is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Turkiye Sise and Aygaz AS

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

The idea behind Turkiye Sise ve and Aygaz AS 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.