Correlation Between Rentokil Initial and PFSweb
Can any of the company-specific risk be diversified away by investing in both Rentokil Initial and PFSweb 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 Rentokil Initial and PFSweb into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rentokil Initial PLC and PFSweb Inc, you can compare the effects of market volatilities on Rentokil Initial and PFSweb 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 Rentokil Initial with a short position of PFSweb. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rentokil Initial and PFSweb.
Diversification Opportunities for Rentokil Initial and PFSweb
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rentokil and PFSweb is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Rentokil Initial PLC and PFSweb Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PFSweb Inc and Rentokil Initial 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 Rentokil Initial PLC are associated (or correlated) with PFSweb. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PFSweb Inc has no effect on the direction of Rentokil Initial i.e., Rentokil Initial and PFSweb go up and down completely randomly.
Pair Corralation between Rentokil Initial and PFSweb
If you would invest 2,621 in Rentokil Initial PLC on August 24, 2024 and sell it today you would lose (59.00) from holding Rentokil Initial PLC or give up 2.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Rentokil Initial PLC vs. PFSweb Inc
Performance |
| Timeline |
| Rentokil Initial PLC |
| PFSweb Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Rentokil Initial and PFSweb Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rentokil Initial and PFSweb
The main advantage of trading using opposite Rentokil Initial and PFSweb positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rentokil Initial position performs unexpectedly, PFSweb 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 PFSweb will offset losses from the drop in PFSweb's long position.| Rentokil Initial vs. Cass Information Systems | Rentokil Initial vs. First Advantage Corp | Rentokil Initial vs. CBIZ Inc | Rentokil Initial vs. Civeo Corp |
| PFSweb vs. Network 1 Technologies | PFSweb vs. Rentokil Initial PLC | PFSweb vs. Cass Information Systems | PFSweb vs. Maximus |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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