Correlation Between Align Technology and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both Align Technology and Planet Fitness 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 Align Technology and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Align Technology and Planet Fitness, you can compare the effects of market volatilities on Align Technology and Planet Fitness 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 Align Technology with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Align Technology and Planet Fitness.
Diversification Opportunities for Align Technology and Planet Fitness
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Align and Planet is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Align Technology and Planet Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness and Align Technology 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 Align Technology are associated (or correlated) with Planet Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Fitness has no effect on the direction of Align Technology i.e., Align Technology and Planet Fitness go up and down completely randomly.
Pair Corralation between Align Technology and Planet Fitness
If you would invest 31,230 in Align Technology on August 30, 2024 and sell it today you would earn a total of 3,624 from holding Align Technology or generate 11.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Align Technology vs. Planet Fitness
Performance |
| Timeline |
| Align Technology |
| Planet Fitness |
Align Technology and Planet Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Align Technology and Planet Fitness
The main advantage of trading using opposite Align Technology and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Align Technology position performs unexpectedly, Planet Fitness 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 Planet Fitness will offset losses from the drop in Planet Fitness' long position.| Align Technology vs. G2D Investments | Align Technology vs. UnitedHealth Group Incorporated | Align Technology vs. STMicroelectronics NV | Align Technology vs. MAHLE Metal Leve |
| Planet Fitness vs. T4F Entretenimento SA | Planet Fitness vs. Manufatura de Brinquedos | Planet Fitness vs. Manufatura de Brinquedos |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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