Correlation Between Planet Fitness and Spire Healthcare
Can any of the company-specific risk be diversified away by investing in both Planet Fitness and Spire 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 Spire 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 Spire Healthcare Group, you can compare the effects of market volatilities on Planet Fitness and Spire 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 Spire Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Planet Fitness and Spire Healthcare.
Diversification Opportunities for Planet Fitness and Spire Healthcare
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Planet and Spire is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Planet Fitness Cl and Spire Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spire 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 Spire Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spire Healthcare has no effect on the direction of Planet Fitness i.e., Planet Fitness and Spire Healthcare go up and down completely randomly.
Pair Corralation between Planet Fitness and Spire Healthcare
Assuming the 90 days trading horizon Planet Fitness Cl is expected to generate 1.29 times more return on investment than Spire Healthcare. However, Planet Fitness is 1.29 times more volatile than Spire Healthcare Group. It trades about 0.01 of its potential returns per unit of risk. Spire Healthcare Group is currently generating about -0.02 per unit of risk. If you would invest 10,165 in Planet Fitness Cl on October 13, 2024 and sell it today you would earn a total of 3.00 from holding Planet Fitness Cl or generate 0.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Planet Fitness Cl vs. Spire Healthcare Group
Performance |
| Timeline |
| Planet Fitness Cl |
| Spire Healthcare |
Planet Fitness and Spire Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Planet Fitness and Spire Healthcare
The main advantage of trading using opposite Planet Fitness and Spire Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Planet Fitness position performs unexpectedly, Spire 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 Spire Healthcare will offset losses from the drop in Spire Healthcare's long position.| Planet Fitness vs. Coeur Mining | Planet Fitness vs. Spirent Communications plc | Planet Fitness vs. Thor Mining PLC | Planet Fitness vs. Batm Advanced Communications |
| Spire Healthcare vs. Fevertree Drinks Plc | Spire Healthcare vs. Fonix Mobile plc | Spire Healthcare vs. Tyson Foods Cl | Spire Healthcare vs. Eastman Chemical Co |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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