Correlation Between Rentokil Initial and Worldpay
Can any of the company-specific risk be diversified away by investing in both Rentokil Initial and Worldpay 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 Rentokil Initial and Worldpay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rentokil Initial plc and Worldpay, you can compare the effects of market volatilities on Rentokil Initial and Worldpay 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 Rentokil Initial with a short position of Worldpay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rentokil Initial and Worldpay.
Diversification Opportunities for Rentokil Initial and Worldpay
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Rentokil and Worldpay is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rentokil Initial plc and Worldpay in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldpay and Rentokil Initial 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 Rentokil Initial plc are associated (or correlated) with Worldpay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldpay has no effect on the direction of Rentokil Initial i.e., Rentokil Initial and Worldpay go up and down completely randomly.
Pair Corralation between Rentokil Initial and Worldpay
If you would invest (100.00) in Worldpay on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Worldpay 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 |
Rentokil Initial plc vs. Worldpay
Performance |
| Timeline |
| Rentokil Initial plc |
| Worldpay |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Rentokil Initial and Worldpay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rentokil Initial and Worldpay
The main advantage of trading using opposite Rentokil Initial and Worldpay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rentokil Initial position performs unexpectedly, Worldpay 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 Worldpay will offset losses from the drop in Worldpay's long position.| Rentokil Initial vs. Thomson Reuters Corp | Rentokil Initial vs. Cintas | Rentokil Initial vs. Global Payments | Rentokil Initial vs. Wolters Kluwer NV |
| Worldpay vs. Torm PLC Class | Worldpay vs. NL Industries | Worldpay vs. Hudson Technologies | Worldpay vs. Sun Country Airlines |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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