Correlation Between Synchrony Financial and Intel
Can any of the company-specific risk be diversified away by investing in both Synchrony Financial and Intel 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 Synchrony Financial and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synchrony Financial and Intel, you can compare the effects of market volatilities on Synchrony Financial and Intel 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 Synchrony Financial with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synchrony Financial and Intel.
Diversification Opportunities for Synchrony Financial and Intel
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Synchrony and Intel is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Synchrony Financial and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Synchrony Financial 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 Synchrony Financial are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Synchrony Financial i.e., Synchrony Financial and Intel go up and down completely randomly.
Pair Corralation between Synchrony Financial and Intel
Assuming the 90 days horizon Synchrony Financial is expected to generate 0.72 times more return on investment than Intel. However, Synchrony Financial is 1.39 times less risky than Intel. It trades about 0.04 of its potential returns per unit of risk. Intel is currently generating about -0.04 per unit of risk. If you would invest 6,412 in Synchrony Financial on November 8, 2024 and sell it today you would earn a total of 97.00 from holding Synchrony Financial or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Synchrony Financial vs. Intel
Performance |
| Timeline |
| Synchrony Financial |
| Intel |
Synchrony Financial and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synchrony Financial and Intel
The main advantage of trading using opposite Synchrony Financial and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synchrony Financial position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Synchrony Financial vs. CAL MAINE FOODS | Synchrony Financial vs. MeVis Medical Solutions | Synchrony Financial vs. US FOODS HOLDING | Synchrony Financial vs. Peijia Medical Limited |
| Intel vs. The Home Depot | Intel vs. CHEMICAL INDUSTRIES | Intel vs. Addus HomeCare | Intel vs. SEKISUI CHEMICAL |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |