Correlation Between Synovus Financial and Linde PLC
Can any of the company-specific risk be diversified away by investing in both Synovus Financial and Linde PLC 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 Linde PLC 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 Linde PLC, you can compare the effects of market volatilities on Synovus Financial and Linde PLC 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 Linde PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synovus Financial and Linde PLC.
Diversification Opportunities for Synovus Financial and Linde PLC
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Synovus and Linde is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Synovus Financial Corp and Linde PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linde PLC 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 Linde PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linde PLC has no effect on the direction of Synovus Financial i.e., Synovus Financial and Linde PLC go up and down completely randomly.
Pair Corralation between Synovus Financial and Linde PLC
Assuming the 90 days trading horizon Synovus Financial Corp is expected to generate 1.85 times more return on investment than Linde PLC. However, Synovus Financial is 1.85 times more volatile than Linde PLC. It trades about 0.05 of its potential returns per unit of risk. Linde PLC is currently generating about 0.05 per unit of risk. If you would invest 5,161 in Synovus Financial Corp on November 7, 2024 and sell it today you would earn a total of 239.00 from holding Synovus Financial Corp or generate 4.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Synovus Financial Corp vs. Linde PLC
Performance |
| Timeline |
| Synovus Financial Corp |
| Linde PLC |
Synovus Financial and Linde PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synovus Financial and Linde PLC
The main advantage of trading using opposite Synovus Financial and Linde PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synovus Financial position performs unexpectedly, Linde PLC 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 Linde PLC will offset losses from the drop in Linde PLC's long position.| Synovus Financial vs. Zoom Video Communications | Synovus Financial vs. TELECOM ITALIA | Synovus Financial vs. CyberArk Software | Synovus Financial vs. ATOSS SOFTWARE |
| Linde PLC vs. Delta Electronics Public | Linde PLC vs. Electronic Arts | Linde PLC vs. COMPUTERSHARE | Linde PLC vs. Rocket Internet SE |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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