Correlation Between Can2 Termik and Galatasaray Sportif

Can any of the company-specific risk be diversified away by investing in both Can2 Termik and Galatasaray Sportif 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 Can2 Termik and Galatasaray Sportif into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Can2 Termik AS and Galatasaray Sportif Sinai, you can compare the effects of market volatilities on Can2 Termik and Galatasaray Sportif 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 Can2 Termik with a short position of Galatasaray Sportif. Check out your portfolio center. Please also check ongoing floating volatility patterns of Can2 Termik and Galatasaray Sportif.

Diversification Opportunities for Can2 Termik and Galatasaray Sportif

-0.45

Correlation Coefficient

Can2 Termik  Galatasaray Sportif

Very good diversification

The 3 months correlation between Can2 and Galatasaray is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Can2 Termik AS and Galatasaray Sportif Sinai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galatasaray Sportif Sinai and Can2 Termik 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 Can2 Termik AS are associated (or correlated) with Galatasaray Sportif. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galatasaray Sportif Sinai has no effect on the direction of Can2 Termik i.e., Can2 Termik and Galatasaray Sportif go up and down completely randomly.

Pair Corralation between Can2 Termik and Galatasaray Sportif

Assuming the 90 days trading horizon Can2 Termik AS is expected to under-perform the Galatasaray Sportif. But the stock apears to be less risky and, when comparing its historical volatility, Can2 Termik AS is 6.15 times less risky than Galatasaray Sportif. The stock trades about -0.03 of its potential returns per unit of risk. The Galatasaray Sportif Sinai is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  205.00  in Galatasaray Sportif Sinai on October 9, 2024 and sell it today you would earn a total of  13.00  from holding Galatasaray Sportif Sinai or generate 6.34% return on investment over 90 days.

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

Can2 Termik AS  vs.  Galatasaray Sportif Sinai

Can2 Termik AS

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Can2 Termik AS are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Can2 Termik demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Galatasaray Sportif Sinai

Risk-Adjusted Performance

3 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Galatasaray Sportif Sinai are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Galatasaray Sportif is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Can2 Termik and Galatasaray Sportif

The main advantage of trading using opposite Can2 Termik and Galatasaray Sportif positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Can2 Termik position performs unexpectedly, Galatasaray Sportif 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 Galatasaray Sportif will offset losses from the drop in Galatasaray Sportif's long position.

The idea behind Can2 Termik AS and Galatasaray Sportif Sinai 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.