Correlation Between Bank of Botetourt and Turkiye Garanti

Can any of the company-specific risk be diversified away by investing in both Bank of Botetourt and Turkiye Garanti 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 Bank of Botetourt and Turkiye Garanti into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bank of Botetourt and Turkiye Garanti Bankasi, you can compare the effects of market volatilities on Bank of Botetourt and Turkiye Garanti 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 Bank of Botetourt with a short position of Turkiye Garanti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Botetourt and Turkiye Garanti.

Diversification Opportunities for Bank of Botetourt and Turkiye Garanti

0.34

Correlation Coefficient

Bank of Botetourt  Turkiye Garanti

Weak diversification

The 3 months correlation between Bank and Turkiye is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Botetourt and Turkiye Garanti Bankasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkiye Garanti Bankasi and Bank of Botetourt 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 Bank of Botetourt are associated (or correlated) with Turkiye Garanti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkiye Garanti Bankasi has no effect on the direction of Bank of Botetourt i.e., Bank of Botetourt and Turkiye Garanti go up and down completely randomly.

Pair Corralation between Bank of Botetourt and Turkiye Garanti

If you would invest  2,808  in Bank of Botetourt on October 9, 2024 and sell it today you would earn a total of  402.00  from holding Bank of Botetourt or generate 14.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	0.46%
Values	Daily Returns

Bank of Botetourt  vs.  Turkiye Garanti Bankasi

Bank of Botetourt

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Bank of Botetourt are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Bank of Botetourt is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Turkiye Garanti Bankasi

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Bank of Botetourt and Turkiye Garanti

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

The idea behind Bank of Botetourt and Turkiye Garanti Bankasi 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.