Correlation Between Procter Gamble and Syntec Optics
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Syntec Optics 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 Procter Gamble and Syntec Optics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Syntec Optics Holdings, you can compare the effects of market volatilities on Procter Gamble and Syntec Optics 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 Procter Gamble with a short position of Syntec Optics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Syntec Optics.
Diversification Opportunities for Procter Gamble and Syntec Optics
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Procter and Syntec is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Syntec Optics Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Syntec Optics Holdings and Procter Gamble 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 Procter Gamble are associated (or correlated) with Syntec Optics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Syntec Optics Holdings has no effect on the direction of Procter Gamble i.e., Procter Gamble and Syntec Optics go up and down completely randomly.
Pair Corralation between Procter Gamble and Syntec Optics
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 0.15 times more return on investment than Syntec Optics. However, Procter Gamble is 6.65 times less risky than Syntec Optics. It trades about 0.32 of its potential returns per unit of risk. Syntec Optics Holdings is currently generating about -0.27 per unit of risk. If you would invest 16,616 in Procter Gamble on August 31, 2024 and sell it today you would earn a total of 1,320 from holding Procter Gamble or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. Syntec Optics Holdings
Performance |
| Timeline |
| Procter Gamble |
| Syntec Optics Holdings |
Procter Gamble and Syntec Optics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Syntec Optics
The main advantage of trading using opposite Procter Gamble and Syntec Optics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Syntec Optics 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 Syntec Optics will offset losses from the drop in Syntec Optics' long position.| Procter Gamble vs. Aquagold International | Procter Gamble vs. Morningstar Unconstrained Allocation | Procter Gamble vs. Thrivent High Yield | Procter Gamble vs. Via Renewables |
| Syntec Optics vs. Deswell Industries | Syntec Optics vs. Vicor | Syntec Optics vs. Eltek | Syntec Optics vs. Flex |
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 CEOs Directory module to screen CEOs from public companies around the world.
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