Correlation Between Kuyas Yatirim and Turkiye Garanti

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

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

Diversification Opportunities for Kuyas Yatirim and Turkiye Garanti

-0.27

Correlation Coefficient

Kuyas Yatirim  Turkiye Garanti

Very good diversification

The 3 months correlation between Kuyas and Turkiye is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Kuyas Yatirim AS and Turkiye Garanti Bankasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turkiye Garanti Bankasi and Kuyas 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 Kuyas Yatirim AS are associated (or correlated) with Turkiye Garanti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turkiye Garanti Bankasi has no effect on the direction of Kuyas Yatirim i.e., Kuyas Yatirim and Turkiye Garanti go up and down completely randomly.

Pair Corralation between Kuyas Yatirim and Turkiye Garanti

Assuming the 90 days trading horizon Kuyas Yatirim AS is expected to generate 1.25 times more return on investment than Turkiye Garanti. However, Kuyas Yatirim is 1.25 times more volatile than Turkiye Garanti Bankasi. It trades about 0.29 of its potential returns per unit of risk. Turkiye Garanti Bankasi is currently generating about 0.0 per unit of risk. If you would invest  2,070  in Kuyas Yatirim AS on December 31, 2024 and sell it today you would earn a total of  1,730  from holding Kuyas Yatirim AS or generate 83.57% return on investment over 90 days.

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

Kuyas Yatirim AS  vs.  Turkiye Garanti Bankasi

Kuyas Yatirim AS

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kuyas Yatirim AS are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Kuyas Yatirim demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Turkiye Garanti Bankasi

Risk-Adjusted Performance

Very Weak

Over the last 90 days Turkiye Garanti Bankasi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Turkiye Garanti is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Kuyas Yatirim and Turkiye Garanti

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

The idea behind Kuyas Yatirim AS and Turkiye Garanti Bankasi 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.