Correlation Between Planet Fitness and Carters
Can any of the company-specific risk be diversified away by investing in both Planet Fitness and Carters 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 Carters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Planet Fitness and Carters, you can compare the effects of market volatilities on Planet Fitness and Carters 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 Carters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Planet Fitness and Carters.
Diversification Opportunities for Planet Fitness and Carters
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Planet and Carters is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Planet Fitness and Carters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carters 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 Carters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carters has no effect on the direction of Planet Fitness i.e., Planet Fitness and Carters go up and down completely randomly.
Pair Corralation between Planet Fitness and Carters
Assuming the 90 days trading horizon Planet Fitness is not expected to generate positive returns. However, Planet Fitness is 1.77 times less risky than Carters. It waists most of its returns potential to compensate for thr risk taken. Carters is generating about -0.01 per unit of risk. If you would invest 4,108 in Planet Fitness on August 31, 2024 and sell it today you would lose (124.00) from holding Planet Fitness or give up 3.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 50.0% |
| Values | Daily Returns |
Planet Fitness vs. Carters
Performance |
| Timeline |
| Planet Fitness |
| Carters |
Planet Fitness and Carters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Planet Fitness and Carters
The main advantage of trading using opposite Planet Fitness and Carters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Planet Fitness position performs unexpectedly, Carters 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 Carters will offset losses from the drop in Carters' long position.| Planet Fitness vs. Cambuci SA | Planet Fitness vs. Bicicletas Monark SA | Planet Fitness vs. Fras le SA | Planet Fitness vs. Western Digital |
| Carters vs. Apartment Investment and | Carters vs. Costco Wholesale | Carters vs. GP Investments | Carters vs. Planet Fitness |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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