Correlation Between RETAIL FOOD and Synchrony Financial
Can any of the company-specific risk be diversified away by investing in both RETAIL FOOD and Synchrony Financial 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 RETAIL FOOD and Synchrony Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RETAIL FOOD GROUP and Synchrony Financial, you can compare the effects of market volatilities on RETAIL FOOD and Synchrony Financial 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 RETAIL FOOD with a short position of Synchrony Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of RETAIL FOOD and Synchrony Financial.
Diversification Opportunities for RETAIL FOOD and Synchrony Financial
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RETAIL and Synchrony is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding RETAIL FOOD GROUP and Synchrony Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synchrony Financial and RETAIL FOOD 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 RETAIL FOOD GROUP are associated (or correlated) with Synchrony Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synchrony Financial has no effect on the direction of RETAIL FOOD i.e., RETAIL FOOD and Synchrony Financial go up and down completely randomly.
Pair Corralation between RETAIL FOOD and Synchrony Financial
Assuming the 90 days trading horizon RETAIL FOOD GROUP is expected to under-perform the Synchrony Financial. In addition to that, RETAIL FOOD is 1.92 times more volatile than Synchrony Financial. It trades about -0.19 of its total potential returns per unit of risk. Synchrony Financial is currently generating about 0.07 per unit of volatility. If you would invest 6,366 in Synchrony Financial on October 30, 2024 and sell it today you would earn a total of 266.00 from holding Synchrony Financial or generate 4.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
RETAIL FOOD GROUP vs. Synchrony Financial
Performance |
| Timeline |
| RETAIL FOOD GROUP |
| Synchrony Financial |
RETAIL FOOD and Synchrony Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RETAIL FOOD and Synchrony Financial
The main advantage of trading using opposite RETAIL FOOD and Synchrony Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RETAIL FOOD position performs unexpectedly, Synchrony Financial 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 Synchrony Financial will offset losses from the drop in Synchrony Financial's long position.| RETAIL FOOD vs. Spirent Communications plc | RETAIL FOOD vs. Cogent Communications Holdings | RETAIL FOOD vs. Suntory Beverage Food | RETAIL FOOD vs. TYSON FOODS A |
| Synchrony Financial vs. SIERRA METALS | Synchrony Financial vs. The Boston Beer | Synchrony Financial vs. Suntory Beverage Food | Synchrony Financial vs. SAN MIGUEL BREWERY |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |