Correlation Between Flutter Entertainment and Omega Healthcare
Can any of the company-specific risk be diversified away by investing in both Flutter Entertainment and Omega Healthcare 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 Omega Healthcare 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 Omega Healthcare Investors, you can compare the effects of market volatilities on Flutter Entertainment and Omega Healthcare 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 Omega Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flutter Entertainment and Omega Healthcare.
Diversification Opportunities for Flutter Entertainment and Omega Healthcare
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Flutter and Omega is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Flutter Entertainment PLC and Omega Healthcare Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omega Healthcare Inv 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 Omega Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omega Healthcare Inv has no effect on the direction of Flutter Entertainment i.e., Flutter Entertainment and Omega Healthcare go up and down completely randomly.
Pair Corralation between Flutter Entertainment and Omega Healthcare
Assuming the 90 days trading horizon Flutter Entertainment PLC is expected to generate 0.94 times more return on investment than Omega Healthcare. However, Flutter Entertainment PLC is 1.06 times less risky than Omega Healthcare. It trades about 0.14 of its potential returns per unit of risk. Omega Healthcare Investors is currently generating about -0.09 per unit of risk. If you would invest 24,630 in Flutter Entertainment PLC on November 3, 2024 and sell it today you would earn a total of 1,240 from holding Flutter Entertainment PLC or generate 5.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flutter Entertainment PLC vs. Omega Healthcare Investors
Performance |
| Timeline |
| Flutter Entertainment PLC |
| Omega Healthcare Inv |
Flutter Entertainment and Omega Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flutter Entertainment and Omega Healthcare
The main advantage of trading using opposite Flutter Entertainment and Omega Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flutter Entertainment position performs unexpectedly, Omega Healthcare 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 Omega Healthcare will offset losses from the drop in Omega Healthcare's long position.| Flutter Entertainment vs. ARROW ELECTRONICS | Flutter Entertainment vs. GRIFFIN MINING LTD | Flutter Entertainment vs. KIMBALL ELECTRONICS | Flutter Entertainment vs. Yanzhou Coal Mining |
| Omega Healthcare vs. BE Semiconductor Industries | Omega Healthcare vs. Elmos Semiconductor SE | Omega Healthcare vs. Magnachip Semiconductor | Omega Healthcare vs. Hua Hong Semiconductor |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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