Correlation Between ICBC Turkey and Creditwest Faktoring
Can any of the company-specific risk be diversified away by investing in both ICBC Turkey and Creditwest Faktoring 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 Creditwest Faktoring 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 Creditwest Faktoring AS, you can compare the effects of market volatilities on ICBC Turkey and Creditwest Faktoring 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 Creditwest Faktoring. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICBC Turkey and Creditwest Faktoring.
Diversification Opportunities for ICBC Turkey and Creditwest Faktoring
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ICBC and Creditwest is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding ICBC Turkey Bank and Creditwest Faktoring AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Creditwest Faktoring 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 Creditwest Faktoring. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Creditwest Faktoring has no effect on the direction of ICBC Turkey i.e., ICBC Turkey and Creditwest Faktoring go up and down completely randomly.
Pair Corralation between ICBC Turkey and Creditwest Faktoring
Assuming the 90 days trading horizon ICBC Turkey is expected to generate 3.76 times less return on investment than Creditwest Faktoring. But when comparing it to its historical volatility, ICBC Turkey Bank is 2.19 times less risky than Creditwest Faktoring. It trades about 0.2 of its potential returns per unit of risk. Creditwest Faktoring AS is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 574.00 in Creditwest Faktoring AS on August 30, 2024 and sell it today you would earn a total of 194.00 from holding Creditwest Faktoring AS or generate 33.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICBC Turkey Bank vs. Creditwest Faktoring AS
Performance |
| Timeline |
| ICBC Turkey Bank |
| Creditwest Faktoring |
ICBC Turkey and Creditwest Faktoring Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICBC Turkey and Creditwest Faktoring
The main advantage of trading using opposite ICBC Turkey and Creditwest Faktoring positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICBC Turkey position performs unexpectedly, Creditwest Faktoring 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 Creditwest Faktoring will offset losses from the drop in Creditwest Faktoring's long position.| ICBC Turkey vs. MEGA METAL | ICBC Turkey vs. Turkiye Kalkinma Bankasi | ICBC Turkey vs. Galatasaray Sportif Sinai | ICBC Turkey vs. Cuhadaroglu Metal Sanayi |
| Creditwest Faktoring vs. Galatasaray Sportif Sinai | Creditwest Faktoring vs. Bms Birlesik Metal | Creditwest Faktoring vs. Koza Anadolu Metal | Creditwest Faktoring vs. Turkish Airlines |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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