Correlation Between Sodas Sodyum and Global Menkul

Can any of the company-specific risk be diversified away by investing in both Sodas Sodyum and Global Menkul 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 Sodas Sodyum and Global Menkul into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sodas Sodyum Sanayi and Global Menkul Degerler, you can compare the effects of market volatilities on Sodas Sodyum and Global Menkul 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 Sodas Sodyum with a short position of Global Menkul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sodas Sodyum and Global Menkul.

Diversification Opportunities for Sodas Sodyum and Global Menkul

-0.04

Correlation Coefficient

Sodas Sodyum  Global Menkul

Good diversification

The 3 months correlation between Sodas and Global is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Sodas Sodyum Sanayi and Global Menkul Degerler in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Menkul Degerler and Sodas Sodyum 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 Sodas Sodyum Sanayi are associated (or correlated) with Global Menkul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Menkul Degerler has no effect on the direction of Sodas Sodyum i.e., Sodas Sodyum and Global Menkul go up and down completely randomly.

Pair Corralation between Sodas Sodyum and Global Menkul

Assuming the 90 days trading horizon Sodas Sodyum Sanayi is expected to under-perform the Global Menkul. But the stock apears to be less risky and, when comparing its historical volatility, Sodas Sodyum Sanayi is 1.96 times less risky than Global Menkul. The stock trades about -0.08 of its potential returns per unit of risk. The Global Menkul Degerler is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,100  in Global Menkul Degerler on October 9, 2024 and sell it today you would earn a total of  62.00  from holding Global Menkul Degerler or generate 5.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	97.62%
Values	Daily Returns

Sodas Sodyum Sanayi  vs.  Global Menkul Degerler

Sodas Sodyum Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sodas Sodyum Sanayi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Sodas Sodyum is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Global Menkul Degerler

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Menkul Degerler are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Global Menkul demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sodas Sodyum and Global Menkul

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

The idea behind Sodas Sodyum Sanayi and Global Menkul Degerler 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.

Check out your portfolio center.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.