Correlation Between Tadir Gan and First International

Can any of the company-specific risk be diversified away by investing in both Tadir Gan and First International 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 Tadir Gan and First International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tadir Gan 1993 and First International Bank, you can compare the effects of market volatilities on Tadir Gan and First International 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 Tadir Gan with a short position of First International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tadir Gan and First International.

Diversification Opportunities for Tadir Gan and First International

-0.25

Correlation Coefficient

Tadir Gan  First International

Very good diversification

The 3 months correlation between Tadir and First is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Tadir Gan 1993 and First International Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First International Bank and Tadir Gan 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 Tadir Gan 1993 are associated (or correlated) with First International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First International Bank has no effect on the direction of Tadir Gan i.e., Tadir Gan and First International go up and down completely randomly.

Pair Corralation between Tadir Gan and First International

Assuming the 90 days trading horizon Tadir Gan 1993 is expected to under-perform the First International. In addition to that, Tadir Gan is 2.15 times more volatile than First International Bank. It trades about -0.01 of its total potential returns per unit of risk. First International Bank is currently generating about 0.09 per unit of volatility. If you would invest  1,374,265  in First International Bank on September 12, 2024 and sell it today you would earn a total of  428,735  from holding First International Bank or generate 31.2% return on investment over 90 days.

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

Tadir Gan 1993  vs.  First International Bank

Tadir Gan 1993

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tadir Gan 1993 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Tadir Gan is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

First International Bank

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in First International Bank are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, First International sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tadir Gan and First International

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

The idea behind Tadir Gan 1993 and First International Bank 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.