Correlation Between Turkcell Iletisim and Turk Telekomunikasyon

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

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

Diversification Opportunities for Turkcell Iletisim and Turk Telekomunikasyon

0.47

Correlation Coefficient

Turkcell Iletisim  Turk Telekomunikasyon

Very weak diversification

The 3 months correlation between Turkcell and Turk is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Turkcell Iletisim Hizmetleri and Turk Telekomunikasyon AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turk Telekomunikasyon and Turkcell Iletisim 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 Turkcell Iletisim Hizmetleri are associated (or correlated) with Turk Telekomunikasyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turk Telekomunikasyon has no effect on the direction of Turkcell Iletisim i.e., Turkcell Iletisim and Turk Telekomunikasyon go up and down completely randomly.

Pair Corralation between Turkcell Iletisim and Turk Telekomunikasyon

Assuming the 90 days trading horizon Turkcell Iletisim Hizmetleri is expected to generate 0.92 times more return on investment than Turk Telekomunikasyon. However, Turkcell Iletisim Hizmetleri is 1.09 times less risky than Turk Telekomunikasyon. It trades about 0.02 of its potential returns per unit of risk. Turk Telekomunikasyon AS is currently generating about -0.05 per unit of risk. If you would invest  9,173  in Turkcell Iletisim Hizmetleri on September 13, 2024 and sell it today you would earn a total of  107.00  from holding Turkcell Iletisim Hizmetleri or generate 1.17% return on investment over 90 days.

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

Turkcell Iletisim Hizmetleri  vs.  Turk Telekomunikasyon AS

Turkcell Iletisim

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Turkcell Iletisim Hizmetleri are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Turkcell Iletisim is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Turk Telekomunikasyon

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Turk Telekomunikasyon AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent 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.

Pair Trading with Turkcell Iletisim and Turk Telekomunikasyon

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

The idea behind Turkcell Iletisim Hizmetleri and Turk Telekomunikasyon 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.