Correlation Between Tradegate and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both Tradegate 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 Tradegate and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tradegate AG Wertpapierhandelsbank and Planet Fitness, you can compare the effects of market volatilities on Tradegate 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 Tradegate with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tradegate and Planet Fitness.
Diversification Opportunities for Tradegate and Planet Fitness
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tradegate and Planet is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Tradegate AG Wertpapierhandels and Planet Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness and Tradegate 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 Tradegate AG Wertpapierhandelsbank 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 has no effect on the direction of Tradegate i.e., Tradegate and Planet Fitness go up and down completely randomly.
Pair Corralation between Tradegate and Planet Fitness
Assuming the 90 days horizon Tradegate AG Wertpapierhandelsbank is expected to under-perform the Planet Fitness. But the stock apears to be less risky and, when comparing its historical volatility, Tradegate AG Wertpapierhandelsbank is 1.51 times less risky than Planet Fitness. The stock trades about -0.05 of its potential returns per unit of risk. The Planet Fitness is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 6,300 in Planet Fitness on November 5, 2024 and sell it today you would earn a total of 4,100 from holding Planet Fitness or generate 65.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tradegate AG Wertpapierhandels vs. Planet Fitness
Performance |
| Timeline |
| Tradegate AG Wertpap |
| Planet Fitness |
Tradegate and Planet Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tradegate and Planet Fitness
The main advantage of trading using opposite Tradegate and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tradegate 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.| Tradegate vs. INSURANCE AUST GRP | Tradegate vs. Tianjin Capital Environmental | Tradegate vs. UNIQA INSURANCE GR | Tradegate vs. ELL ENVIRONHLDGS HD 0001 |
| Planet Fitness vs. Booking Holdings | Planet Fitness vs. Oriental Land Co | Planet Fitness vs. ANTA Sports Products | Planet Fitness vs. Li Ning Company |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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