Correlation Between Synchrony Financial and Cintas

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

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

Diversification Opportunities for Synchrony Financial and Cintas

0.19

Correlation Coefficient

Synchrony Financial  Cintas

Average diversification

The 3 months correlation between Synchrony and Cintas is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Synchrony Financial and Cintas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cintas and Synchrony 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 Synchrony Financial are associated (or correlated) with Cintas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cintas has no effect on the direction of Synchrony Financial i.e., Synchrony Financial and Cintas go up and down completely randomly.

Pair Corralation between Synchrony Financial and Cintas

Assuming the 90 days horizon Synchrony Financial is expected to generate 1.21 times more return on investment than Cintas. However, Synchrony Financial is 1.21 times more volatile than Cintas. It trades about 0.03 of its potential returns per unit of risk. Cintas is currently generating about -0.12 per unit of risk. If you would invest  6,336  in Synchrony Financial on August 24, 2025 and sell it today you would earn a total of  159.00  from holding Synchrony Financial or generate 2.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

Synchrony Financial  vs.  Cintas

Synchrony Financial

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Synchrony Financial are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Synchrony Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Cintas

Risk-Adjusted Performance

Weakest

Over the last 90 days Cintas 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.

Pair Trading with Synchrony Financial and Cintas

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

The idea behind Synchrony Financial and Cintas 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.