Correlation Between Vakif Menkul and Viking Kagit

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

By analyzing existing cross correlation between Vakif Menkul Kiymet and Viking Kagit ve, you can compare the effects of market volatilities on Vakif Menkul and Viking Kagit 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 Menkul with a short position of Viking Kagit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vakif Menkul and Viking Kagit.

Diversification Opportunities for Vakif Menkul and Viking Kagit

-0.72

Correlation Coefficient

Vakif Menkul  Viking Kagit

Pay attention - limited upside

The 3 months correlation between Vakif and Viking is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Vakif Menkul Kiymet and Viking Kagit ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viking Kagit ve and Vakif Menkul 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 Menkul Kiymet are associated (or correlated) with Viking Kagit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viking Kagit ve has no effect on the direction of Vakif Menkul i.e., Vakif Menkul and Viking Kagit go up and down completely randomly.

Pair Corralation between Vakif Menkul and Viking Kagit

Assuming the 90 days trading horizon Vakif Menkul is expected to generate 3.62 times less return on investment than Viking Kagit. But when comparing it to its historical volatility, Vakif Menkul Kiymet is 2.08 times less risky than Viking Kagit. It trades about 0.23 of its potential returns per unit of risk. Viking Kagit ve is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest  4,186  in Viking Kagit ve on February 1, 2024 and sell it today you would earn a total of  1,689  from holding Viking Kagit ve or generate 40.35% return on investment over 90 days.

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

Vakif Menkul Kiymet  vs.  Viking Kagit ve

Vakif Menkul Kiymet

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vakif Menkul Kiymet 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 basic indicators remain fairly strong which may send shares a bit higher in June 2024. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Viking Kagit ve

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Viking Kagit ve are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent technical and fundamental indicators, Viking Kagit demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vakif Menkul and Viking Kagit

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

The idea behind Vakif Menkul Kiymet and Viking Kagit ve 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.