Correlation Between Apartment Investment and Flutter Entertainment

Can any of the company-specific risk be diversified away by investing in both Apartment Investment 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 Apartment Investment and Flutter Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apartment Investment and and Flutter Entertainment plc, you can compare the effects of market volatilities on Apartment Investment 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 Apartment Investment with a short position of Flutter Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apartment Investment and Flutter Entertainment.

Diversification Opportunities for Apartment Investment and Flutter Entertainment

0.68

Correlation Coefficient

Apartment Investment  Flutter Entertainment

Poor diversification

The 3 months correlation between Apartment and Flutter is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Apartment Investment and 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 Apartment Investment 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 Apartment Investment and 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 Apartment Investment i.e., Apartment Investment and Flutter Entertainment go up and down completely randomly.

Pair Corralation between Apartment Investment and Flutter Entertainment

Considering the 90-day investment horizon Apartment Investment and is expected to under-perform the Flutter Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Apartment Investment and is 1.16 times less risky than Flutter Entertainment. The stock trades about -0.03 of its potential returns per unit of risk. The Flutter Entertainment plc is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  24,935  in Flutter Entertainment plc on May 17, 2025 and sell it today you would earn a total of  3,942  from holding Flutter Entertainment plc or generate 15.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

Apartment Investment and  vs.  Flutter Entertainment plc

Apartment Investment and

Risk-Adjusted Performance

Weakest

Over the last 90 days Apartment Investment and has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable forward indicators, Apartment Investment is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Flutter Entertainment plc

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Flutter Entertainment plc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Flutter Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Apartment Investment and Flutter Entertainment

The main advantage of trading using opposite Apartment Investment and Flutter Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apartment Investment 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.

The idea behind Apartment Investment and and Flutter Entertainment 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.