Correlation Between Global Yatirim and Akbank TAS

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

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

Diversification Opportunities for Global Yatirim and Akbank TAS

0.52

Correlation Coefficient

Global Yatirim  Akbank TAS

Very weak diversification

The 3 months correlation between Global and Akbank is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Global Yatirim Holding and Akbank TAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akbank TAS and Global Yatirim 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 Global Yatirim Holding are associated (or correlated) with Akbank TAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akbank TAS has no effect on the direction of Global Yatirim i.e., Global Yatirim and Akbank TAS go up and down completely randomly.

Pair Corralation between Global Yatirim and Akbank TAS

Assuming the 90 days trading horizon Global Yatirim Holding is expected to generate 1.11 times more return on investment than Akbank TAS. However, Global Yatirim is 1.11 times more volatile than Akbank TAS. It trades about 0.12 of its potential returns per unit of risk. Akbank TAS is currently generating about -0.04 per unit of risk. If you would invest  560.00  in Global Yatirim Holding on December 23, 2024 and sell it today you would earn a total of  147.00  from holding Global Yatirim Holding or generate 26.25% return on investment over 90 days.

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

Global Yatirim Holding  vs.  Akbank TAS

Global Yatirim Holding

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global Yatirim Holding are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Global Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Akbank TAS

Risk-Adjusted Performance

Very Weak

Over the last 90 days Akbank TAS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Global Yatirim and Akbank TAS

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

The idea behind Global Yatirim Holding and Akbank TAS 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.