Correlation Between Vakif Finansal and Koza Anadolu

Can any of the company-specific risk be diversified away by investing in both Vakif Finansal and Koza Anadolu 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 Vakif Finansal and Koza Anadolu into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vakif Finansal Kiralama and Koza Anadolu Metal, you can compare the effects of market volatilities on Vakif Finansal and Koza Anadolu 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 Vakif Finansal with a short position of Koza Anadolu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vakif Finansal and Koza Anadolu.

Diversification Opportunities for Vakif Finansal and Koza Anadolu

0.65

Correlation Coefficient

Vakif Finansal  Koza Anadolu

Poor diversification

The 3 months correlation between Vakif and Koza is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Vakif Finansal Kiralama and Koza Anadolu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koza Anadolu Metal and Vakif Finansal 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 Vakif Finansal Kiralama are associated (or correlated) with Koza Anadolu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koza Anadolu Metal has no effect on the direction of Vakif Finansal i.e., Vakif Finansal and Koza Anadolu go up and down completely randomly.

Pair Corralation between Vakif Finansal and Koza Anadolu

Assuming the 90 days trading horizon Vakif Finansal is expected to generate 1.51 times less return on investment than Koza Anadolu. But when comparing it to its historical volatility, Vakif Finansal Kiralama is 1.04 times less risky than Koza Anadolu. It trades about 0.04 of its potential returns per unit of risk. Koza Anadolu Metal is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  5,280  in Koza Anadolu Metal on September 24, 2024 and sell it today you would earn a total of  1,230  from holding Koza Anadolu Metal or generate 23.3% return on investment over 90 days.

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

Vakif Finansal Kiralama  vs.  Koza Anadolu Metal

Vakif Finansal Kiralama

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vakif Finansal Kiralama are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Vakif Finansal may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Koza Anadolu Metal

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Vakif Finansal and Koza Anadolu

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

The idea behind Vakif Finansal Kiralama and Koza Anadolu Metal 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.