Correlation Between Turkiye Garanti and Indeks Bilgisayar

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

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

Diversification Opportunities for Turkiye Garanti and Indeks Bilgisayar

0.91

Correlation Coefficient

Turkiye Garanti  Indeks Bilgisayar

Almost no diversification

The 3 months correlation between Turkiye and Indeks is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Garanti Bankasi and Indeks Bilgisayar Sistemleri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indeks Bilgisayar and Turkiye Garanti 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 Turkiye Garanti Bankasi are associated (or correlated) with Indeks Bilgisayar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indeks Bilgisayar has no effect on the direction of Turkiye Garanti i.e., Turkiye Garanti and Indeks Bilgisayar go up and down completely randomly.

Pair Corralation between Turkiye Garanti and Indeks Bilgisayar

Assuming the 90 days trading horizon Turkiye Garanti is expected to generate 1.36 times less return on investment than Indeks Bilgisayar. In addition to that, Turkiye Garanti is 1.08 times more volatile than Indeks Bilgisayar Sistemleri. It trades about 0.14 of its total potential returns per unit of risk. Indeks Bilgisayar Sistemleri is currently generating about 0.2 per unit of volatility. If you would invest  618.00  in Indeks Bilgisayar Sistemleri on October 22, 2024 and sell it today you would earn a total of  170.00  from holding Indeks Bilgisayar Sistemleri or generate 27.51% return on investment over 90 days.

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

Turkiye Garanti Bankasi  vs.  Indeks Bilgisayar Sistemleri

Turkiye Garanti Bankasi

Risk-Adjusted Performance

10 of 100

OK

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

Indeks Bilgisayar

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Indeks Bilgisayar Sistemleri are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, Indeks Bilgisayar demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Turkiye Garanti and Indeks Bilgisayar

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

The idea behind Turkiye Garanti Bankasi and Indeks Bilgisayar Sistemleri 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.