Correlation Between Flutter Entertainment and Aon PLC
Can any of the company-specific risk be diversified away by investing in both Flutter Entertainment and Aon PLC 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 Flutter Entertainment and Aon PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flutter Entertainment PLC and Aon PLC, you can compare the effects of market volatilities on Flutter Entertainment and Aon PLC 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 Flutter Entertainment with a short position of Aon PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flutter Entertainment and Aon PLC.
Diversification Opportunities for Flutter Entertainment and Aon PLC
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Flutter and Aon is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Flutter Entertainment PLC and Aon PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aon PLC and Flutter Entertainment 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 Flutter Entertainment PLC are associated (or correlated) with Aon PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aon PLC has no effect on the direction of Flutter Entertainment i.e., Flutter Entertainment and Aon PLC go up and down completely randomly.
Pair Corralation between Flutter Entertainment and Aon PLC
Assuming the 90 days trading horizon Flutter Entertainment is expected to generate 1.04 times less return on investment than Aon PLC. In addition to that, Flutter Entertainment is 1.15 times more volatile than Aon PLC. It trades about 0.13 of its total potential returns per unit of risk. Aon PLC is currently generating about 0.15 per unit of volatility. If you would invest 34,096 in Aon PLC on November 5, 2024 and sell it today you would earn a total of 1,524 from holding Aon PLC or generate 4.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flutter Entertainment PLC vs. Aon PLC
Performance |
| Timeline |
| Flutter Entertainment PLC |
| Aon PLC |
Flutter Entertainment and Aon PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flutter Entertainment and Aon PLC
The main advantage of trading using opposite Flutter Entertainment and Aon PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flutter Entertainment position performs unexpectedly, Aon PLC 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 Aon PLC will offset losses from the drop in Aon PLC's long position.| Flutter Entertainment vs. PLANT VEDA FOODS | Flutter Entertainment vs. PATTIES FOODS | Flutter Entertainment vs. VULCAN MATERIALS | Flutter Entertainment vs. APPLIED MATERIALS |
| Aon PLC vs. CORNISH METALS INC | Aon PLC vs. Sims Metal Management | Aon PLC vs. US Physical Therapy | Aon PLC vs. Osisko Metals |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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