Correlation Between Spring Valley and Turkiye Garanti

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

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

Diversification Opportunities for Spring Valley and Turkiye Garanti

-0.2

Correlation Coefficient

Spring Valley  Turkiye Garanti

Good diversification

The 3 months correlation between Spring and Turkiye is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Spring Valley Acquisition 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 Spring Valley 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 Spring Valley Acquisition 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 Spring Valley i.e., Spring Valley and Turkiye Garanti go up and down completely randomly.

Pair Corralation between Spring Valley and Turkiye Garanti

Given the investment horizon of 90 days Spring Valley Acquisition is expected to generate 0.03 times more return on investment than Turkiye Garanti. However, Spring Valley Acquisition is 29.18 times less risky than Turkiye Garanti. It trades about 0.32 of its potential returns per unit of risk. Turkiye Garanti Bankasi is currently generating about -0.04 per unit of risk. If you would invest  1,126  in Spring Valley Acquisition on December 28, 2024 and sell it today you would earn a total of  26.00  from holding Spring Valley Acquisition or generate 2.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Spring Valley Acquisition  vs.  Turkiye Garanti Bankasi

Spring Valley Acquisition

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Spring Valley Acquisition are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Spring Valley is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

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. In spite of latest weak performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Spring Valley and Turkiye Garanti

The main advantage of trading using opposite Spring Valley and Turkiye Garanti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spring Valley 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 Spring Valley Acquisition 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.

Check out your portfolio center.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.