Correlation Between Pentair Plc and Sixt Leasing
Can any of the company-specific risk be diversified away by investing in both Pentair Plc and Sixt Leasing 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 Pentair Plc and Sixt Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pentair plc and Sixt Leasing SE, you can compare the effects of market volatilities on Pentair Plc and Sixt Leasing 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 Pentair Plc with a short position of Sixt Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pentair Plc and Sixt Leasing.
Diversification Opportunities for Pentair Plc and Sixt Leasing
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Pentair and Sixt is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Pentair plc and Sixt Leasing SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixt Leasing SE and Pentair Plc 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 Pentair plc are associated (or correlated) with Sixt Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixt Leasing SE has no effect on the direction of Pentair Plc i.e., Pentair Plc and Sixt Leasing go up and down completely randomly.
Pair Corralation between Pentair Plc and Sixt Leasing
Assuming the 90 days horizon Pentair plc is expected to under-perform the Sixt Leasing. In addition to that, Pentair Plc is 1.03 times more volatile than Sixt Leasing SE. It trades about -0.25 of its total potential returns per unit of risk. Sixt Leasing SE is currently generating about -0.19 per unit of volatility. If you would invest 960.00 in Sixt Leasing SE on October 11, 2024 and sell it today you would lose (50.00) from holding Sixt Leasing SE or give up 5.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pentair plc vs. Sixt Leasing SE
Performance |
| Timeline |
| Pentair plc |
| Sixt Leasing SE |
Pentair Plc and Sixt Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pentair Plc and Sixt Leasing
The main advantage of trading using opposite Pentair Plc and Sixt Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pentair Plc position performs unexpectedly, Sixt Leasing 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 Sixt Leasing will offset losses from the drop in Sixt Leasing's long position.| Pentair Plc vs. Cars Inc | Pentair Plc vs. Hemisphere Energy Corp | Pentair Plc vs. Computershare Limited | Pentair Plc vs. CARSALESCOM |
| Sixt Leasing vs. SYSTEMAIR AB | Sixt Leasing vs. Entravision Communications | Sixt Leasing vs. FORWARD AIR P | Sixt Leasing vs. Cogent Communications 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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