Correlation Between Synchrony Financial and National Bank
Can any of the company-specific risk be diversified away by investing in both Synchrony Financial and National Bank 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 Synchrony Financial and National Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synchrony Financial and National Bank of, you can compare the effects of market volatilities on Synchrony Financial and National Bank 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 Synchrony Financial with a short position of National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synchrony Financial and National Bank.
Diversification Opportunities for Synchrony Financial and National Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Synchrony and National is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Synchrony Financial and National Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank and Synchrony Financial 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 Synchrony Financial are associated (or correlated) with National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank has no effect on the direction of Synchrony Financial i.e., Synchrony Financial and National Bank go up and down completely randomly.
Pair Corralation between Synchrony Financial and National Bank
If you would invest 5,528 in Synchrony Financial on September 1, 2024 and sell it today you would earn a total of 1,224 from holding Synchrony Financial or generate 22.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Synchrony Financial vs. National Bank of
Performance |
| Timeline |
| Synchrony Financial |
| National Bank |
Synchrony Financial and National Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synchrony Financial and National Bank
The main advantage of trading using opposite Synchrony Financial and National Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synchrony Financial position performs unexpectedly, National Bank 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 National Bank will offset losses from the drop in National Bank's long position.| Synchrony Financial vs. Uniper SE | Synchrony Financial vs. Mulberry Group PLC | Synchrony Financial vs. London Security Plc | Synchrony Financial vs. Triad Group PLC |
| National Bank vs. Extra Space Storage | National Bank vs. Public Storage | National Bank vs. Datagroup SE | National Bank vs. Charter Communications Cl |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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