Correlation Between ENKA Insaat and Sumas Suni

Can any of the company-specific risk be diversified away by investing in both ENKA Insaat and Sumas Suni 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 ENKA Insaat and Sumas Suni into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ENKA Insaat ve and Sumas Suni Tahta, you can compare the effects of market volatilities on ENKA Insaat and Sumas Suni 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 ENKA Insaat with a short position of Sumas Suni. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENKA Insaat and Sumas Suni.

Diversification Opportunities for ENKA Insaat and Sumas Suni

-0.64

Correlation Coefficient

ENKA Insaat  Sumas Suni

Excellent diversification

The 3 months correlation between ENKA and Sumas is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding ENKA Insaat ve and Sumas Suni Tahta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumas Suni Tahta and ENKA Insaat 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 ENKA Insaat ve are associated (or correlated) with Sumas Suni. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumas Suni Tahta has no effect on the direction of ENKA Insaat i.e., ENKA Insaat and Sumas Suni go up and down completely randomly.

Pair Corralation between ENKA Insaat and Sumas Suni

Assuming the 90 days trading horizon ENKA Insaat is expected to generate 3.79 times less return on investment than Sumas Suni. But when comparing it to its historical volatility, ENKA Insaat ve is 2.62 times less risky than Sumas Suni. It trades about 0.06 of its potential returns per unit of risk. Sumas Suni Tahta is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  52,150  in Sumas Suni Tahta on February 8, 2024 and sell it today you would earn a total of  6,850  from holding Sumas Suni Tahta or generate 13.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	97.3%
Values	Daily Returns

ENKA Insaat ve  vs.  Sumas Suni Tahta

ENKA Insaat ve

Risk-Adjusted Performance

0 of 100

Very Weak

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

Sumas Suni Tahta

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sumas Suni Tahta are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Sumas Suni demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ENKA Insaat and Sumas Suni

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

The idea behind ENKA Insaat ve and Sumas Suni Tahta 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.