Correlation Between Synthomer Plc and Naturhouse Health
Can any of the company-specific risk be diversified away by investing in both Synthomer Plc and Naturhouse Health 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 Naturhouse Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synthomer plc and Naturhouse Health SA, you can compare the effects of market volatilities on Synthomer Plc and Naturhouse Health 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 Naturhouse Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synthomer Plc and Naturhouse Health.
Diversification Opportunities for Synthomer Plc and Naturhouse Health
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Synthomer and Naturhouse is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Synthomer plc and Naturhouse Health SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naturhouse Health 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 Naturhouse Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naturhouse Health has no effect on the direction of Synthomer Plc i.e., Synthomer Plc and Naturhouse Health go up and down completely randomly.
Pair Corralation between Synthomer Plc and Naturhouse Health
Assuming the 90 days trading horizon Synthomer Plc is expected to generate 7.98 times less return on investment than Naturhouse Health. In addition to that, Synthomer Plc is 2.85 times more volatile than Naturhouse Health SA. It trades about 0.0 of its total potential returns per unit of risk. Naturhouse Health SA is currently generating about 0.11 per unit of volatility. If you would invest 167.00 in Naturhouse Health SA on November 3, 2024 and sell it today you would earn a total of 5.00 from holding Naturhouse Health SA or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Synthomer plc vs. Naturhouse Health SA
Performance |
| Timeline |
| Synthomer plc |
| Naturhouse Health |
Synthomer Plc and Naturhouse Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synthomer Plc and Naturhouse Health
The main advantage of trading using opposite Synthomer Plc and Naturhouse Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synthomer Plc position performs unexpectedly, Naturhouse Health 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 Naturhouse Health will offset losses from the drop in Naturhouse Health's long position.| Synthomer Plc vs. Monster Beverage Corp | Synthomer Plc vs. Fevertree Drinks Plc | Synthomer Plc vs. Roadside Real Estate | Synthomer Plc vs. Cars Inc |
| Naturhouse Health vs. United States Steel | Naturhouse Health vs. Lundin Mining Corp | Naturhouse Health vs. Symphony Environmental Technologies | Naturhouse Health vs. Iron Mountain |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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