Correlation Between Synovus Financial and Société Générale
Can any of the company-specific risk be diversified away by investing in both Synovus Financial and Société Générale 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 Synovus Financial and Société Générale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synovus Financial Corp and Socit Gnrale Socit, you can compare the effects of market volatilities on Synovus Financial and Société Générale 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 Synovus Financial with a short position of Société Générale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synovus Financial and Société Générale.
Diversification Opportunities for Synovus Financial and Société Générale
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Synovus and Société is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Synovus Financial Corp and Socit Gnrale Socit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socit Gnrale Socit and Synovus 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 Synovus Financial Corp are associated (or correlated) with Société Générale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socit Gnrale Socit has no effect on the direction of Synovus Financial i.e., Synovus Financial and Société Générale go up and down completely randomly.
Pair Corralation between Synovus Financial and Société Générale
Assuming the 90 days trading horizon Synovus Financial Corp is expected to generate 1.31 times more return on investment than Société Générale. However, Synovus Financial is 1.31 times more volatile than Socit Gnrale Socit. It trades about 0.13 of its potential returns per unit of risk. Socit Gnrale Socit is currently generating about -0.02 per unit of risk. If you would invest 3,546 in Synovus Financial Corp on September 1, 2024 and sell it today you would earn a total of 1,804 from holding Synovus Financial Corp or generate 50.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.24% |
| Values | Daily Returns |
Synovus Financial Corp vs. Socit Gnrale Socit
Performance |
| Timeline |
| Synovus Financial Corp |
| Socit Gnrale Socit |
Synovus Financial and Société Générale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synovus Financial and Société Générale
The main advantage of trading using opposite Synovus Financial and Société Générale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synovus Financial position performs unexpectedly, Société Générale 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 Société Générale will offset losses from the drop in Société Générale's long position.| Synovus Financial vs. PARKEN Sport Entertainment | Synovus Financial vs. LPKF Laser Electronics | Synovus Financial vs. UMC Electronics Co | Synovus Financial vs. UET United Electronic |
| Société Générale vs. Constellation Software | Société Générale vs. Nippon Steel | Société Générale vs. ALGOMA STEEL GROUP | Société Générale vs. FORMPIPE SOFTWARE AB |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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