Correlation Between Entain Plc and Flutter Entertainment
Can any of the company-specific risk be diversified away by investing in both Entain Plc and Flutter Entertainment 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 Entain Plc and Flutter Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entain Plc and Flutter Entertainment PLC, you can compare the effects of market volatilities on Entain Plc and Flutter Entertainment 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 Entain Plc with a short position of Flutter Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entain Plc and Flutter Entertainment.
Diversification Opportunities for Entain Plc and Flutter Entertainment
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Entain and Flutter is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Entain Plc and Flutter Entertainment PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flutter Entertainment PLC and Entain 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 Entain Plc are associated (or correlated) with Flutter Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flutter Entertainment PLC has no effect on the direction of Entain Plc i.e., Entain Plc and Flutter Entertainment go up and down completely randomly.
Pair Corralation between Entain Plc and Flutter Entertainment
If you would invest 1,015 in Entain Plc on February 4, 2024 and sell it today you would earn a total of 9.00 from holding Entain Plc or generate 0.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 4.35% |
Values | Daily Returns |
Entain Plc vs. Flutter Entertainment PLC
Performance |
Timeline |
Entain Plc |
Flutter Entertainment PLC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Entain Plc and Flutter Entertainment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Entain Plc and Flutter Entertainment
The main advantage of trading using opposite Entain Plc and Flutter Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entain Plc position performs unexpectedly, Flutter Entertainment 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 Flutter Entertainment will offset losses from the drop in Flutter Entertainment's long position.Entain Plc vs. Light Wonder | Entain Plc vs. Cardiff Oncology | Entain Plc vs. Hecla Mining | Entain Plc vs. Tencent Music Entertainment |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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