Correlation Between Planet Fitness and HUTCHISON TELECOMM
Can any of the company-specific risk be diversified away by investing in both Planet Fitness and HUTCHISON TELECOMM 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 HUTCHISON TELECOMM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Planet Fitness and HUTCHISON TELECOMM, you can compare the effects of market volatilities on Planet Fitness and HUTCHISON TELECOMM 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 HUTCHISON TELECOMM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Planet Fitness and HUTCHISON TELECOMM.
Diversification Opportunities for Planet Fitness and HUTCHISON TELECOMM
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Planet and HUTCHISON is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Planet Fitness and HUTCHISON TELECOMM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUTCHISON TELECOMM 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 are associated (or correlated) with HUTCHISON TELECOMM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUTCHISON TELECOMM has no effect on the direction of Planet Fitness i.e., Planet Fitness and HUTCHISON TELECOMM go up and down completely randomly.
Pair Corralation between Planet Fitness and HUTCHISON TELECOMM
Assuming the 90 days horizon Planet Fitness is expected to generate 0.4 times more return on investment than HUTCHISON TELECOMM. However, Planet Fitness is 2.48 times less risky than HUTCHISON TELECOMM. It trades about 0.08 of its potential returns per unit of risk. HUTCHISON TELECOMM is currently generating about 0.01 per unit of risk. If you would invest 5,550 in Planet Fitness on November 8, 2024 and sell it today you would earn a total of 4,650 from holding Planet Fitness or generate 83.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Planet Fitness vs. HUTCHISON TELECOMM
Performance |
| Timeline |
| Planet Fitness |
| HUTCHISON TELECOMM |
Planet Fitness and HUTCHISON TELECOMM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Planet Fitness and HUTCHISON TELECOMM
The main advantage of trading using opposite Planet Fitness and HUTCHISON TELECOMM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Planet Fitness position performs unexpectedly, HUTCHISON TELECOMM 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 HUTCHISON TELECOMM will offset losses from the drop in HUTCHISON TELECOMM's long position.| Planet Fitness vs. MPH Health Care | Planet Fitness vs. CEOTRONICS | Planet Fitness vs. US Physical Therapy | Planet Fitness vs. DATATEC LTD 2 |
| HUTCHISON TELECOMM vs. Apple Inc | HUTCHISON TELECOMM vs. Apple Inc | HUTCHISON TELECOMM vs. Apple Inc | HUTCHISON TELECOMM vs. Apple Inc |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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