Correlation Between Sekerbank TAS and Pegasus Hava

Can any of the company-specific risk be diversified away by investing in both Sekerbank TAS and Pegasus Hava 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 Sekerbank TAS and Pegasus Hava into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sekerbank TAS and Pegasus Hava Tasimaciligi, you can compare the effects of market volatilities on Sekerbank TAS and Pegasus Hava 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 Sekerbank TAS with a short position of Pegasus Hava. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sekerbank TAS and Pegasus Hava.

Diversification Opportunities for Sekerbank TAS and Pegasus Hava

0.78

Correlation Coefficient

Sekerbank TAS  Pegasus Hava

Poor diversification

The 3 months correlation between Sekerbank and Pegasus is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Sekerbank TAS and Pegasus Hava Tasimaciligi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pegasus Hava Tasimaciligi and Sekerbank TAS 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 Sekerbank TAS are associated (or correlated) with Pegasus Hava. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pegasus Hava Tasimaciligi has no effect on the direction of Sekerbank TAS i.e., Sekerbank TAS and Pegasus Hava go up and down completely randomly.

Pair Corralation between Sekerbank TAS and Pegasus Hava

Assuming the 90 days trading horizon Sekerbank TAS is expected to generate 2.89 times less return on investment than Pegasus Hava. In addition to that, Sekerbank TAS is 1.31 times more volatile than Pegasus Hava Tasimaciligi. It trades about 0.03 of its total potential returns per unit of risk. Pegasus Hava Tasimaciligi is currently generating about 0.13 per unit of volatility. If you would invest  21,040  in Pegasus Hava Tasimaciligi on April 4, 2024 and sell it today you would earn a total of  1,390  from holding Pegasus Hava Tasimaciligi or generate 6.61% return on investment over 90 days.

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

Sekerbank TAS  vs.  Pegasus Hava Tasimaciligi

Sekerbank TAS

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sekerbank TAS are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward-looking signals, Sekerbank TAS demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pegasus Hava Tasimaciligi

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pegasus Hava Tasimaciligi are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Pegasus Hava demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sekerbank TAS and Pegasus Hava

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

The idea behind Sekerbank TAS and Pegasus Hava Tasimaciligi 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.