Correlation Between Synovus Financial and Platinum Investment
Can any of the company-specific risk be diversified away by investing in both Synovus Financial and Platinum Investment 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 Platinum Investment 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 Platinum Investment Management, you can compare the effects of market volatilities on Synovus Financial and Platinum Investment 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 Platinum Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synovus Financial and Platinum Investment.
Diversification Opportunities for Synovus Financial and Platinum Investment
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Synovus and Platinum is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Synovus Financial Corp and Platinum Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Investment 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 Platinum Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Investment has no effect on the direction of Synovus Financial i.e., Synovus Financial and Platinum Investment go up and down completely randomly.
Pair Corralation between Synovus Financial and Platinum Investment
Assuming the 90 days trading horizon Synovus Financial Corp is expected to under-perform the Platinum Investment. But the stock apears to be less risky and, when comparing its historical volatility, Synovus Financial Corp is 2.93 times less risky than Platinum Investment. The stock trades about -0.17 of its potential returns per unit of risk. The Platinum Investment Management is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 34.00 in Platinum Investment Management on October 12, 2024 and sell it today you would earn a total of 8.00 from holding Platinum Investment Management or generate 23.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Synovus Financial Corp vs. Platinum Investment Management
Performance |
Timeline |
Synovus Financial Corp |
Platinum Investment |
Synovus Financial and Platinum Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Synovus Financial and Platinum Investment
The main advantage of trading using opposite Synovus Financial and Platinum Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synovus Financial position performs unexpectedly, Platinum Investment 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 Platinum Investment will offset losses from the drop in Platinum Investment's long position.Synovus Financial vs. Digilife Technologies Limited | Synovus Financial vs. Siamgas And Petrochemicals | Synovus Financial vs. Soken Chemical Engineering | Synovus Financial vs. Mitsubishi Gas Chemical |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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