Correlation Between Pets At and Linde Plc

Can any of the company-specific risk be diversified away by investing in both Pets At and Linde Plc 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 Pets At and Linde Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pets at Home and Linde plc, you can compare the effects of market volatilities on Pets At and Linde Plc 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 Pets At with a short position of Linde Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pets At and Linde Plc.

Diversification Opportunities for Pets At and Linde Plc

-0.01

Correlation Coefficient

Pets At  Linde Plc

Good diversification

The 3 months correlation between Pets and Linde is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Pets at Home and Linde plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linde plc and Pets At 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 Pets at Home are associated (or correlated) with Linde Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linde plc has no effect on the direction of Pets At i.e., Pets At and Linde Plc go up and down completely randomly.

Pair Corralation between Pets At and Linde Plc

Assuming the 90 days horizon Pets at Home is expected to under-perform the Linde Plc. In addition to that, Pets At is 2.18 times more volatile than Linde plc. It trades about -0.08 of its total potential returns per unit of risk. Linde plc is currently generating about 0.01 per unit of volatility. If you would invest  41,049  in Linde plc on May 27, 2025 and sell it today you would earn a total of  171.00  from holding Linde plc or generate 0.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Pets at Home  vs.  Linde plc

Pets at Home

Risk-Adjusted Performance

Weakest

Over the last 90 days Pets at Home has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Linde plc

Risk-Adjusted Performance

Soft

Over the last 90 days Linde plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Linde Plc is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Pets At and Linde Plc

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

The idea behind Pets at Home and Linde plc 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..