Correlation Between Flutter Entertainment and INTERCONT HOTELS
Can any of the company-specific risk be diversified away by investing in both Flutter Entertainment and INTERCONT HOTELS 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 INTERCONT HOTELS 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 INTERCONT HOTELS, you can compare the effects of market volatilities on Flutter Entertainment and INTERCONT HOTELS 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 INTERCONT HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flutter Entertainment and INTERCONT HOTELS.
Diversification Opportunities for Flutter Entertainment and INTERCONT HOTELS
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Flutter and INTERCONT is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Flutter Entertainment PLC and INTERCONT HOTELS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTERCONT HOTELS 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 INTERCONT HOTELS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTERCONT HOTELS has no effect on the direction of Flutter Entertainment i.e., Flutter Entertainment and INTERCONT HOTELS go up and down completely randomly.
Pair Corralation between Flutter Entertainment and INTERCONT HOTELS
Assuming the 90 days trading horizon Flutter Entertainment PLC is expected to generate 1.19 times more return on investment than INTERCONT HOTELS. However, Flutter Entertainment is 1.19 times more volatile than INTERCONT HOTELS. It trades about 0.0 of its potential returns per unit of risk. INTERCONT HOTELS is currently generating about -0.18 per unit of risk. If you would invest 25,040 in Flutter Entertainment PLC on November 28, 2024 and sell it today you would lose (60.00) from holding Flutter Entertainment PLC or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Flutter Entertainment PLC vs. INTERCONT HOTELS
Performance |
| Timeline |
| Flutter Entertainment PLC |
| INTERCONT HOTELS |
Flutter Entertainment and INTERCONT HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flutter Entertainment and INTERCONT HOTELS
The main advantage of trading using opposite Flutter Entertainment and INTERCONT HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flutter Entertainment position performs unexpectedly, INTERCONT HOTELS 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 INTERCONT HOTELS will offset losses from the drop in INTERCONT HOTELS's long position.| Flutter Entertainment vs. EPSILON HEALTHCARE LTD | Flutter Entertainment vs. OPKO HEALTH | Flutter Entertainment vs. Molina Healthcare | Flutter Entertainment vs. United Utilities Group |
| INTERCONT HOTELS vs. Packaging of | INTERCONT HOTELS vs. ERSTE GP BNK | INTERCONT HOTELS vs. W R Berkley | INTERCONT HOTELS vs. News Corporation |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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