Correlation Between Turkiye Garanti and Eurobank Ergasias
Can any of the company-specific risk be diversified away by investing in both Turkiye Garanti and Eurobank Ergasias 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 Garanti and Eurobank Ergasias into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Turkiye Garanti Bankasi and Eurobank Ergasias SA, you can compare the effects of market volatilities on Turkiye Garanti and Eurobank Ergasias 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 Garanti with a short position of Eurobank Ergasias. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turkiye Garanti and Eurobank Ergasias.
Diversification Opportunities for Turkiye Garanti and Eurobank Ergasias
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Turkiye and Eurobank is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Garanti Bankasi and Eurobank Ergasias SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurobank Ergasias and Turkiye Garanti 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 Garanti Bankasi are associated (or correlated) with Eurobank Ergasias. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eurobank Ergasias has no effect on the direction of Turkiye Garanti i.e., Turkiye Garanti and Eurobank Ergasias go up and down completely randomly.
Pair Corralation between Turkiye Garanti and Eurobank Ergasias
Assuming the 90 days horizon Turkiye Garanti Bankasi is expected to generate 1.86 times more return on investment than Eurobank Ergasias. However, Turkiye Garanti is 1.86 times more volatile than Eurobank Ergasias SA. It trades about 0.08 of its potential returns per unit of risk. Eurobank Ergasias SA is currently generating about 0.05 per unit of risk. If you would invest 177.00 in Turkiye Garanti Bankasi on August 26, 2024 and sell it today you would earn a total of 148.00 from holding Turkiye Garanti Bankasi or generate 83.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Turkiye Garanti Bankasi vs. Eurobank Ergasias SA
Performance |
| Timeline |
| Turkiye Garanti Bankasi |
| Eurobank Ergasias |
Turkiye Garanti and Eurobank Ergasias Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Turkiye Garanti and Eurobank Ergasias
The main advantage of trading using opposite Turkiye Garanti and Eurobank Ergasias positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Turkiye Garanti position performs unexpectedly, Eurobank Ergasias 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 Eurobank Ergasias will offset losses from the drop in Eurobank Ergasias' long position.| Turkiye Garanti vs. Kasikornbank Public Co | Turkiye Garanti vs. Hang Seng Bank | Turkiye Garanti vs. PT Bank Rakyat | Turkiye Garanti vs. Delhi Bank Corp |
| Eurobank Ergasias vs. PSB Holdings | Eurobank Ergasias vs. United Overseas Bank | Eurobank Ergasias vs. Turkiye Garanti Bankasi |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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