Correlation Between DENTSPLY SIRONA and Charter Communications

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

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

Diversification Opportunities for DENTSPLY SIRONA and Charter Communications

0.23

Correlation Coefficient

DENTSPLY SIRONA  Charter Communications

Modest diversification

The 3 months correlation between DENTSPLY and Charter is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding DENTSPLY SIRONA and Charter Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charter Communications and DENTSPLY SIRONA 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 DENTSPLY SIRONA are associated (or correlated) with Charter Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charter Communications has no effect on the direction of DENTSPLY SIRONA i.e., DENTSPLY SIRONA and Charter Communications go up and down completely randomly.

Pair Corralation between DENTSPLY SIRONA and Charter Communications

Assuming the 90 days trading horizon DENTSPLY SIRONA is expected to under-perform the Charter Communications. In addition to that, DENTSPLY SIRONA is 2.24 times more volatile than Charter Communications. It trades about -0.12 of its total potential returns per unit of risk. Charter Communications is currently generating about 0.01 per unit of volatility. If you would invest  3,529  in Charter Communications on April 25, 2025 and sell it today you would earn a total of  18.00  from holding Charter Communications or generate 0.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

DENTSPLY SIRONA  vs.  Charter Communications

DENTSPLY SIRONA

Risk-Adjusted Performance

Very Weak

Over the last 90 days DENTSPLY SIRONA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Charter Communications

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Charter Communications are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, Charter Communications is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with DENTSPLY SIRONA and Charter Communications

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

The idea behind DENTSPLY SIRONA and Charter Communications 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.