Correlation Between Allegion PLC and Starry Group

Can any of the company-specific risk be diversified away by investing in both Allegion PLC and Starry Group 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 Allegion PLC and Starry Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Allegion PLC and Starry Group Holdings, you can compare the effects of market volatilities on Allegion PLC and Starry Group 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 Allegion PLC with a short position of Starry Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allegion PLC and Starry Group.

Diversification Opportunities for Allegion PLC and Starry Group

0.0

Correlation Coefficient

Allegion PLC  Starry Group

Pay attention - limited upside

The 3 months correlation between Allegion and Starry is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Allegion PLC and Starry Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Starry Group Holdings and Allegion 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 Allegion PLC are associated (or correlated) with Starry Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Starry Group Holdings has no effect on the direction of Allegion PLC i.e., Allegion PLC and Starry Group go up and down completely randomly.

Pair Corralation between Allegion PLC and Starry Group

If you would invest (100.00) in Starry Group Holdings on October 9, 2024 and sell it today you would earn a total of  100.00  from holding Starry Group Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Allegion PLC  vs.  Starry Group Holdings

Allegion PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Allegion PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's essential indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Starry Group Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Starry Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Starry Group is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Allegion PLC and Starry Group

The main advantage of trading using opposite Allegion PLC and Starry Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allegion PLC position performs unexpectedly, Starry Group 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 Starry Group will offset losses from the drop in Starry Group's long position.

The idea behind Allegion PLC and Starry Group Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.