Correlation Between Synthomer Plc and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both Synthomer Plc and Planet Fitness 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 Synthomer Plc and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synthomer plc and Planet Fitness Cl, you can compare the effects of market volatilities on Synthomer Plc and Planet Fitness 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 Synthomer Plc with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synthomer Plc and Planet Fitness.
Diversification Opportunities for Synthomer Plc and Planet Fitness
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Synthomer and Planet is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Synthomer plc and Planet Fitness Cl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness Cl and Synthomer Plc 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 Synthomer plc are associated (or correlated) with Planet Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Fitness Cl has no effect on the direction of Synthomer Plc i.e., Synthomer Plc and Planet Fitness go up and down completely randomly.
Pair Corralation between Synthomer Plc and Planet Fitness
Assuming the 90 days trading horizon Synthomer plc is expected to under-perform the Planet Fitness. In addition to that, Synthomer Plc is 1.52 times more volatile than Planet Fitness Cl. It trades about -0.07 of its total potential returns per unit of risk. Planet Fitness Cl is currently generating about 0.04 per unit of volatility. If you would invest 7,677 in Planet Fitness Cl on September 3, 2024 and sell it today you would earn a total of 2,285 from holding Planet Fitness Cl or generate 29.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 80.32% |
| Values | Daily Returns |
Synthomer plc vs. Planet Fitness Cl
Performance |
| Timeline |
| Synthomer plc |
| Planet Fitness Cl |
Synthomer Plc and Planet Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synthomer Plc and Planet Fitness
The main advantage of trading using opposite Synthomer Plc and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synthomer Plc position performs unexpectedly, Planet Fitness 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 Planet Fitness will offset losses from the drop in Planet Fitness' long position.| Synthomer Plc vs. Target Healthcare REIT | Synthomer Plc vs. Batm Advanced Communications | Synthomer Plc vs. Charter Communications Cl | Synthomer Plc vs. Zoom Video Communications |
| Planet Fitness vs. PPHE Hotel Group | Planet Fitness vs. Arrow Electronics | Planet Fitness vs. Vienna Insurance Group | Planet Fitness vs. Dalata Hotel Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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