Correlation Between Flutter Entertainment and SemiLEDS

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

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

Diversification Opportunities for Flutter Entertainment and SemiLEDS

0.39

Correlation Coefficient

Flutter Entertainment  SemiLEDS

Weak diversification

The 3 months correlation between Flutter and SemiLEDS is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Flutter Entertainment PLC and SemiLEDS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SemiLEDS and Flutter Entertainment 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 Flutter Entertainment PLC are associated (or correlated) with SemiLEDS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SemiLEDS has no effect on the direction of Flutter Entertainment i.e., Flutter Entertainment and SemiLEDS go up and down completely randomly.

Pair Corralation between Flutter Entertainment and SemiLEDS

Assuming the 90 days trading horizon Flutter Entertainment PLC is expected to generate 0.28 times more return on investment than SemiLEDS. However, Flutter Entertainment PLC is 3.54 times less risky than SemiLEDS. It trades about 0.23 of its potential returns per unit of risk. SemiLEDS is currently generating about 0.05 per unit of risk. If you would invest  20,210  in Flutter Entertainment PLC on April 24, 2025 and sell it today you would earn a total of  5,340  from holding Flutter Entertainment PLC or generate 26.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Flutter Entertainment PLC  vs.  SemiLEDS

Flutter Entertainment PLC

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Flutter Entertainment PLC are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Flutter Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

SemiLEDS

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SemiLEDS are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain fundamental indicators, SemiLEDS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Flutter Entertainment and SemiLEDS

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

The idea behind Flutter Entertainment PLC and SemiLEDS 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..