Correlation Between ICBC Turkey and Trabzonspor Sportif

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

By analyzing existing cross correlation between ICBC Turkey Bank and Trabzonspor Sportif Yatirim, you can compare the effects of market volatilities on ICBC Turkey and Trabzonspor 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 ICBC Turkey with a short position of Trabzonspor Sportif. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICBC Turkey and Trabzonspor Sportif.

Diversification Opportunities for ICBC Turkey and Trabzonspor Sportif

-0.16

Correlation Coefficient

ICBC Turkey  Trabzonspor Sportif

Good diversification

The 3 months correlation between ICBC and Trabzonspor is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding ICBC Turkey Bank and Trabzonspor Sportif Yatirim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trabzonspor Sportif and ICBC Turkey 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 ICBC Turkey Bank are associated (or correlated) with Trabzonspor Sportif. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trabzonspor Sportif has no effect on the direction of ICBC Turkey i.e., ICBC Turkey and Trabzonspor Sportif go up and down completely randomly.

Pair Corralation between ICBC Turkey and Trabzonspor Sportif

Assuming the 90 days trading horizon ICBC Turkey Bank is expected to generate 0.93 times more return on investment than Trabzonspor Sportif. However, ICBC Turkey Bank is 1.08 times less risky than Trabzonspor Sportif. It trades about 0.04 of its potential returns per unit of risk. Trabzonspor Sportif Yatirim is currently generating about -0.05 per unit of risk. If you would invest  1,170  in ICBC Turkey Bank on September 14, 2024 and sell it today you would earn a total of  247.00  from holding ICBC Turkey Bank or generate 21.11% return on investment over 90 days.

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

ICBC Turkey Bank  vs.  Trabzonspor Sportif Yatirim

ICBC Turkey Bank

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ICBC Turkey Bank are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, ICBC Turkey is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Trabzonspor Sportif

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trabzonspor Sportif Yatirim has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with ICBC Turkey and Trabzonspor Sportif

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

The idea behind ICBC Turkey Bank and Trabzonspor Sportif Yatirim 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.