Correlation Between INPOST SA and RENTOKIL INITIAL
Can any of the company-specific risk be diversified away by investing in both INPOST SA and RENTOKIL INITIAL 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 INPOST SA and RENTOKIL INITIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INPOST SA EO and RENTOKIL INITIAL ADR5, you can compare the effects of market volatilities on INPOST SA and RENTOKIL INITIAL 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 INPOST SA with a short position of RENTOKIL INITIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of INPOST SA and RENTOKIL INITIAL.
Diversification Opportunities for INPOST SA and RENTOKIL INITIAL
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between INPOST and RENTOKIL is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding INPOST SA EO and RENTOKIL INITIAL ADR5 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RENTOKIL INITIAL ADR5 and INPOST SA 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 INPOST SA EO are associated (or correlated) with RENTOKIL INITIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RENTOKIL INITIAL ADR5 has no effect on the direction of INPOST SA i.e., INPOST SA and RENTOKIL INITIAL go up and down completely randomly.
Pair Corralation between INPOST SA and RENTOKIL INITIAL
Assuming the 90 days horizon INPOST SA EO is expected to generate 0.37 times more return on investment than RENTOKIL INITIAL. However, INPOST SA EO is 2.68 times less risky than RENTOKIL INITIAL. It trades about -0.05 of its potential returns per unit of risk. RENTOKIL INITIAL ADR5 is currently generating about -0.27 per unit of risk. If you would invest 1,641 in INPOST SA EO on December 11, 2024 and sell it today you would lose (22.00) from holding INPOST SA EO or give up 1.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INPOST SA EO vs. RENTOKIL INITIAL ADR5
Performance |
| Timeline |
| INPOST SA EO |
| RENTOKIL INITIAL ADR5 |
INPOST SA and RENTOKIL INITIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INPOST SA and RENTOKIL INITIAL
The main advantage of trading using opposite INPOST SA and RENTOKIL INITIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INPOST SA position performs unexpectedly, RENTOKIL INITIAL 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 RENTOKIL INITIAL will offset losses from the drop in RENTOKIL INITIAL's long position.| INPOST SA vs. FORMPIPE SOFTWARE AB | INPOST SA vs. VITEC SOFTWARE GROUP | INPOST SA vs. RYU Apparel | INPOST SA vs. PSI Software AG |
| RENTOKIL INITIAL vs. Wayside Technology Group | RENTOKIL INITIAL vs. Vishay Intertechnology | RENTOKIL INITIAL vs. ScanSource | RENTOKIL INITIAL vs. GEELY AUTOMOBILE |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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