Correlation Between Yesil Yapi and Borlease Otomotiv

Can any of the company-specific risk be diversified away by investing in both Yesil Yapi and Borlease Otomotiv 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 Yesil Yapi and Borlease Otomotiv into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Yesil Yapi Endustrisi and Borlease Otomotiv AS, you can compare the effects of market volatilities on Yesil Yapi and Borlease Otomotiv 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 Yesil Yapi with a short position of Borlease Otomotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yesil Yapi and Borlease Otomotiv.

Diversification Opportunities for Yesil Yapi and Borlease Otomotiv

-0.9

Correlation Coefficient

Yesil Yapi  Borlease Otomotiv

Pay attention - limited upside

The 3 months correlation between Yesil and Borlease is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Yesil Yapi Endustrisi and Borlease Otomotiv AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Borlease Otomotiv and Yesil Yapi 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 Yesil Yapi Endustrisi are associated (or correlated) with Borlease Otomotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Borlease Otomotiv has no effect on the direction of Yesil Yapi i.e., Yesil Yapi and Borlease Otomotiv go up and down completely randomly.

Pair Corralation between Yesil Yapi and Borlease Otomotiv

Assuming the 90 days trading horizon Yesil Yapi Endustrisi is expected to under-perform the Borlease Otomotiv. In addition to that, Yesil Yapi is 1.4 times more volatile than Borlease Otomotiv AS. It trades about -0.2 of its total potential returns per unit of risk. Borlease Otomotiv AS is currently generating about 0.19 per unit of volatility. If you would invest  6,480  in Borlease Otomotiv AS on December 25, 2024 and sell it today you would earn a total of  2,170  from holding Borlease Otomotiv AS or generate 33.49% return on investment over 90 days.

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

Yesil Yapi Endustrisi  vs.  Borlease Otomotiv AS

Yesil Yapi Endustrisi

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yesil Yapi Endustrisi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Borlease Otomotiv

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Borlease Otomotiv AS are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Borlease Otomotiv demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Yesil Yapi and Borlease Otomotiv

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

The idea behind Yesil Yapi Endustrisi and Borlease Otomotiv 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.