Correlation Between Turkiye Garanti and Anadolu Efes

Can any of the company-specific risk be diversified away by investing in both Turkiye Garanti and Anadolu Efes 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 Anadolu Efes 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 Anadolu Efes Biracilik, you can compare the effects of market volatilities on Turkiye Garanti and Anadolu Efes 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 Anadolu Efes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turkiye Garanti and Anadolu Efes.

Diversification Opportunities for Turkiye Garanti and Anadolu Efes

0.96

Correlation Coefficient

Turkiye Garanti  Anadolu Efes

Almost no diversification

The 3 months correlation between Turkiye and Anadolu is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Turkiye Garanti Bankasi and Anadolu Efes Biracilik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anadolu Efes Biracilik 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 Anadolu Efes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anadolu Efes Biracilik has no effect on the direction of Turkiye Garanti i.e., Turkiye Garanti and Anadolu Efes go up and down completely randomly.

Pair Corralation between Turkiye Garanti and Anadolu Efes

Assuming the 90 days trading horizon Turkiye Garanti Bankasi is expected to generate 1.18 times more return on investment than Anadolu Efes. However, Turkiye Garanti is 1.18 times more volatile than Anadolu Efes Biracilik. It trades about 0.46 of its potential returns per unit of risk. Anadolu Efes Biracilik is currently generating about 0.11 per unit of risk. If you would invest  8,430  in Turkiye Garanti Bankasi on March 5, 2024 and sell it today you would earn a total of  2,350  from holding Turkiye Garanti Bankasi or generate 27.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Turkiye Garanti Bankasi  vs.  Anadolu Efes Biracilik

Turkiye Garanti Bankasi

Risk-Adjusted Performance

33 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Turkiye Garanti Bankasi are ranked lower than 33 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Turkiye Garanti demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Anadolu Efes Biracilik

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Anadolu Efes Biracilik are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Anadolu Efes demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Turkiye Garanti and Anadolu Efes

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

The idea behind Turkiye Garanti Bankasi and Anadolu Efes Biracilik 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.