Correlation Between Planet Fitness and Inspiration Healthcare
Can any of the company-specific risk be diversified away by investing in both Planet Fitness and Inspiration Healthcare 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 Inspiration Healthcare 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 Inspiration Healthcare Group, you can compare the effects of market volatilities on Planet Fitness and Inspiration Healthcare 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 Inspiration Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Planet Fitness and Inspiration Healthcare.
Diversification Opportunities for Planet Fitness and Inspiration Healthcare
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Planet and Inspiration is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Planet Fitness Cl and Inspiration Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspiration Healthcare 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 Inspiration Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspiration Healthcare has no effect on the direction of Planet Fitness i.e., Planet Fitness and Inspiration Healthcare go up and down completely randomly.
Pair Corralation between Planet Fitness and Inspiration Healthcare
Assuming the 90 days trading horizon Planet Fitness Cl is expected to generate 0.5 times more return on investment than Inspiration Healthcare. However, Planet Fitness Cl is 1.99 times less risky than Inspiration Healthcare. It trades about 0.18 of its potential returns per unit of risk. Inspiration Healthcare Group is currently generating about -0.03 per unit of risk. If you would invest 6,340 in Planet Fitness Cl on August 30, 2024 and sell it today you would earn a total of 3,733 from holding Planet Fitness Cl or generate 58.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.53% |
| Values | Daily Returns |
Planet Fitness Cl vs. Inspiration Healthcare Group
Performance |
| Timeline |
| Planet Fitness Cl |
| Inspiration Healthcare |
Planet Fitness and Inspiration Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Planet Fitness and Inspiration Healthcare
The main advantage of trading using opposite Planet Fitness and Inspiration Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Planet Fitness position performs unexpectedly, Inspiration Healthcare 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 Inspiration Healthcare will offset losses from the drop in Inspiration Healthcare's long position.| Planet Fitness vs. Tungsten West PLC | Planet Fitness vs. Argo Group Limited | Planet Fitness vs. Hardide PLC | Planet Fitness vs. Versarien PLC |
| Inspiration Healthcare vs. Toyota Motor Corp | Inspiration Healthcare vs. SoftBank Group Corp | Inspiration Healthcare vs. OTP Bank Nyrt | Inspiration Healthcare vs. Las Vegas Sands |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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