Correlation Between Tekfen Holding and Lokman Hekim

Can any of the company-specific risk be diversified away by investing in both Tekfen Holding and Lokman Hekim 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 Tekfen Holding and Lokman Hekim into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tekfen Holding AS and Lokman Hekim Engurusag, you can compare the effects of market volatilities on Tekfen Holding and Lokman Hekim 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 Tekfen Holding with a short position of Lokman Hekim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekfen Holding and Lokman Hekim.

Diversification Opportunities for Tekfen Holding and Lokman Hekim

-0.6

Correlation Coefficient

Tekfen Holding  Lokman Hekim

Excellent diversification

The 3 months correlation between Tekfen and Lokman is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Tekfen Holding AS and Lokman Hekim Engurusag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lokman Hekim Engurusag and Tekfen Holding 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 Tekfen Holding AS are associated (or correlated) with Lokman Hekim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lokman Hekim Engurusag has no effect on the direction of Tekfen Holding i.e., Tekfen Holding and Lokman Hekim go up and down completely randomly.

Pair Corralation between Tekfen Holding and Lokman Hekim

Assuming the 90 days trading horizon Tekfen Holding is expected to generate 5.91 times less return on investment than Lokman Hekim. But when comparing it to its historical volatility, Tekfen Holding AS is 6.73 times less risky than Lokman Hekim. It trades about 0.06 of its potential returns per unit of risk. Lokman Hekim Engurusag is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  469.00  in Lokman Hekim Engurusag on October 26, 2024 and sell it today you would earn a total of  1,683  from holding Lokman Hekim Engurusag or generate 358.85% return on investment over 90 days.

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

Tekfen Holding AS  vs.  Lokman Hekim Engurusag

Tekfen Holding AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tekfen Holding AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain 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.

Lokman Hekim Engurusag

Risk-Adjusted Performance

26 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Lokman Hekim Engurusag are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Lokman Hekim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tekfen Holding and Lokman Hekim

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

The idea behind Tekfen Holding AS and Lokman Hekim Engurusag 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.