Correlation Between Planet Fitness and Cairo Communication
Can any of the company-specific risk be diversified away by investing in both Planet Fitness and Cairo Communication 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 Planet Fitness and Cairo Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Planet Fitness Cl and Cairo Communication SpA, you can compare the effects of market volatilities on Planet Fitness and Cairo Communication 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 Planet Fitness with a short position of Cairo Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Planet Fitness and Cairo Communication.
Diversification Opportunities for Planet Fitness and Cairo Communication
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Planet and Cairo is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Planet Fitness Cl and Cairo Communication SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cairo Communication SpA and Planet Fitness 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 Planet Fitness Cl are associated (or correlated) with Cairo Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cairo Communication SpA has no effect on the direction of Planet Fitness i.e., Planet Fitness and Cairo Communication go up and down completely randomly.
Pair Corralation between Planet Fitness and Cairo Communication
Assuming the 90 days trading horizon Planet Fitness Cl is expected to generate 1.12 times more return on investment than Cairo Communication. However, Planet Fitness is 1.12 times more volatile than Cairo Communication SpA. It trades about 0.13 of its potential returns per unit of risk. Cairo Communication SpA is currently generating about 0.06 per unit of risk. If you would invest 6,292 in Planet Fitness Cl on September 3, 2024 and sell it today you would earn a total of 3,688 from holding Planet Fitness Cl or generate 58.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Planet Fitness Cl vs. Cairo Communication SpA
Performance |
| Timeline |
| Planet Fitness Cl |
| Cairo Communication SpA |
Planet Fitness and Cairo Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Planet Fitness and Cairo Communication
The main advantage of trading using opposite Planet Fitness and Cairo Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Planet Fitness position performs unexpectedly, Cairo Communication 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 Cairo Communication will offset losses from the drop in Cairo Communication's long position.| Planet Fitness vs. PPHE Hotel Group | Planet Fitness vs. Arrow Electronics | Planet Fitness vs. Vienna Insurance Group | Planet Fitness vs. Dalata Hotel Group |
| Cairo Communication vs. Catalyst Media Group | Cairo Communication vs. CATLIN GROUP | Cairo Communication vs. Magnora ASA | Cairo Communication vs. RTW Venture Fund |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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