Correlation Between Cintas and Grounded People
Can any of the company-specific risk be diversified away by investing in both Cintas and Grounded People 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 Cintas and Grounded People into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cintas and Grounded People Apparel, you can compare the effects of market volatilities on Cintas and Grounded People 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 Cintas with a short position of Grounded People. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cintas and Grounded People.
Diversification Opportunities for Cintas and Grounded People
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cintas and Grounded is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cintas and Grounded People Apparel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grounded People Apparel and Cintas 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 Cintas are associated (or correlated) with Grounded People. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grounded People Apparel has no effect on the direction of Cintas i.e., Cintas and Grounded People go up and down completely randomly.
Pair Corralation between Cintas and Grounded People
Given the investment horizon of 90 days Cintas is expected to generate 1.18 times less return on investment than Grounded People. But when comparing it to its historical volatility, Cintas is 4.22 times less risky than Grounded People. It trades about 0.1 of its potential returns per unit of risk. Grounded People Apparel is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 101.00 in Grounded People Apparel on October 26, 2024 and sell it today you would earn a total of 2.00 from holding Grounded People Apparel or generate 1.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Cintas vs. Grounded People Apparel
Performance |
| Timeline |
| Cintas |
| Grounded People Apparel |
Cintas and Grounded People Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cintas and Grounded People
The main advantage of trading using opposite Cintas and Grounded People positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cintas position performs unexpectedly, Grounded People 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 Grounded People will offset losses from the drop in Grounded People's long position.| Cintas vs. ABM Industries Incorporated | Cintas vs. Copart Inc | Cintas vs. Dolby Laboratories | Cintas vs. Relx PLC ADR |
| Grounded People vs. Verra Mobility Corp | Grounded People vs. Deluxe | Grounded People vs. Saia Inc | Grounded People vs. Lindblad Expeditions Holdings |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |