Correlation Between Synchrony Financial and Cornish Metals
Can any of the company-specific risk be diversified away by investing in both Synchrony Financial and Cornish Metals 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 Synchrony Financial and Cornish Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synchrony Financial and Cornish Metals, you can compare the effects of market volatilities on Synchrony Financial and Cornish Metals 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 Synchrony Financial with a short position of Cornish Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synchrony Financial and Cornish Metals.
Diversification Opportunities for Synchrony Financial and Cornish Metals
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Synchrony and Cornish is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Synchrony Financial and Cornish Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cornish Metals and Synchrony 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 Synchrony Financial are associated (or correlated) with Cornish Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cornish Metals has no effect on the direction of Synchrony Financial i.e., Synchrony Financial and Cornish Metals go up and down completely randomly.
Pair Corralation between Synchrony Financial and Cornish Metals
Assuming the 90 days trading horizon Synchrony Financial is expected to generate 2.43 times less return on investment than Cornish Metals. But when comparing it to its historical volatility, Synchrony Financial is 3.18 times less risky than Cornish Metals. It trades about 0.07 of its potential returns per unit of risk. Cornish Metals is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 790.00 in Cornish Metals on September 12, 2024 and sell it today you would earn a total of 25.00 from holding Cornish Metals or generate 3.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.45% |
Values | Daily Returns |
Synchrony Financial vs. Cornish Metals
Performance |
Timeline |
Synchrony Financial |
Cornish Metals |
Synchrony Financial and Cornish Metals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Synchrony Financial and Cornish Metals
The main advantage of trading using opposite Synchrony Financial and Cornish Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synchrony Financial position performs unexpectedly, Cornish Metals 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 Cornish Metals will offset losses from the drop in Cornish Metals' long position.Synchrony Financial vs. Hong Kong Land | Synchrony Financial vs. Neometals | Synchrony Financial vs. Coor Service Management | Synchrony Financial vs. Fidelity Sustainable USD |
Cornish Metals vs. Givaudan SA | Cornish Metals vs. Antofagasta PLC | Cornish Metals vs. Ferrexpo PLC | Cornish Metals vs. Atalaya Mining |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |