Correlation Between Turkiye Kalkinma and Galata Wind

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

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

Diversification Opportunities for Turkiye Kalkinma and Galata Wind

-0.55

Correlation Coefficient

Turkiye Kalkinma  Galata Wind

Excellent diversification

The 3 months correlation between Turkiye and Galata is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Kalkinma Bankasi and Galata Wind Enerji in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galata Wind Enerji and Turkiye Kalkinma 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 Kalkinma Bankasi are associated (or correlated) with Galata Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galata Wind Enerji has no effect on the direction of Turkiye Kalkinma i.e., Turkiye Kalkinma and Galata Wind go up and down completely randomly.

Pair Corralation between Turkiye Kalkinma and Galata Wind

Assuming the 90 days trading horizon Turkiye Kalkinma Bankasi is expected to under-perform the Galata Wind. But the stock apears to be less risky and, when comparing its historical volatility, Turkiye Kalkinma Bankasi is 1.69 times less risky than Galata Wind. The stock trades about -0.13 of its potential returns per unit of risk. The Galata Wind Enerji is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  2,732  in Galata Wind Enerji on October 6, 2024 and sell it today you would earn a total of  396.00  from holding Galata Wind Enerji or generate 14.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Turkiye Kalkinma Bankasi  vs.  Galata Wind Enerji

Turkiye Kalkinma Bankasi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Turkiye Kalkinma Bankasi 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.

Galata Wind Enerji

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Galata Wind Enerji are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Galata Wind demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Turkiye Kalkinma and Galata Wind

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

The idea behind Turkiye Kalkinma Bankasi and Galata Wind Enerji 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.