Correlation Between Suburban Propane and Fortune Brands
Can any of the company-specific risk be diversified away by investing in both Suburban Propane and Fortune Brands 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 Suburban Propane and Fortune Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Suburban Propane Partners and Fortune Brands Home, you can compare the effects of market volatilities on Suburban Propane and Fortune Brands 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 Suburban Propane with a short position of Fortune Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suburban Propane and Fortune Brands.
Diversification Opportunities for Suburban Propane and Fortune Brands
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Suburban and Fortune is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Suburban Propane Partners and Fortune Brands Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortune Brands Home and Suburban Propane 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 Suburban Propane Partners are associated (or correlated) with Fortune Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortune Brands Home has no effect on the direction of Suburban Propane i.e., Suburban Propane and Fortune Brands go up and down completely randomly.
Pair Corralation between Suburban Propane and Fortune Brands
If you would invest 1,606 in Suburban Propane Partners on September 14, 2024 and sell it today you would earn a total of 289.00 from holding Suburban Propane Partners or generate 18.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Suburban Propane Partners vs. Fortune Brands Home
Performance |
| Timeline |
| Suburban Propane Partners |
| Fortune Brands Home |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Suburban Propane and Fortune Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suburban Propane and Fortune Brands
The main advantage of trading using opposite Suburban Propane and Fortune Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suburban Propane position performs unexpectedly, Fortune Brands 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 Fortune Brands will offset losses from the drop in Fortune Brands' long position.| Suburban Propane vs. One Gas | Suburban Propane vs. NiSource | Suburban Propane vs. Aquagold International | Suburban Propane vs. Thrivent High Yield |
| Fortune Brands vs. Marchex | Fortune Brands vs. Deluxe | Fortune Brands vs. Boston Omaha Corp | Fortune Brands vs. Q2 Holdings |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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