Correlation Between Turk Hava and Equinor ASA

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

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

Diversification Opportunities for Turk Hava and Equinor ASA

-0.75

Correlation Coefficient

Turk Hava  Equinor ASA

Pay attention - limited upside

The 3 months correlation between Turk and Equinor is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Turk Hava Yollari and Equinor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equinor ASA and Turk Hava 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 Turk Hava Yollari are associated (or correlated) with Equinor ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equinor ASA has no effect on the direction of Turk Hava i.e., Turk Hava and Equinor ASA go up and down completely randomly.

Pair Corralation between Turk Hava and Equinor ASA

Assuming the 90 days horizon Turk Hava Yollari is expected to under-perform the Equinor ASA. But the pink sheet apears to be less risky and, when comparing its historical volatility, Turk Hava Yollari is 1.27 times less risky than Equinor ASA. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Equinor ASA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  2,225  in Equinor ASA on May 6, 2025 and sell it today you would earn a total of  374.00  from holding Equinor ASA or generate 16.81% return on investment over 90 days.

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

Turk Hava Yollari  vs.  Equinor ASA

Turk Hava Yollari

Risk-Adjusted Performance

Very Weak

Over the last 90 days Turk Hava Yollari has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Turk Hava is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Equinor ASA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Equinor ASA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical indicators, Equinor ASA reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Turk Hava and Equinor ASA

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

The idea behind Turk Hava Yollari and Equinor ASA 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.