Correlation Between FitLife Brands, and Continental
Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and Continental 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 FitLife Brands, and Continental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FitLife Brands, Common and Continental AG PK, you can compare the effects of market volatilities on FitLife Brands, and Continental 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 FitLife Brands, with a short position of Continental. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and Continental.
Diversification Opportunities for FitLife Brands, and Continental
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between FitLife and Continental is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and Continental AG PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Continental AG PK and FitLife Brands, 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 FitLife Brands, Common are associated (or correlated) with Continental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Continental AG PK has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Continental go up and down completely randomly.
Pair Corralation between FitLife Brands, and Continental
Given the investment horizon of 90 days FitLife Brands, Common is expected to generate 1.22 times more return on investment than Continental. However, FitLife Brands, is 1.22 times more volatile than Continental AG PK. It trades about 0.06 of its potential returns per unit of risk. Continental AG PK is currently generating about 0.02 per unit of risk. If you would invest 1,700 in FitLife Brands, Common on August 30, 2024 and sell it today you would earn a total of 1,661 from holding FitLife Brands, Common or generate 97.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
FitLife Brands, Common vs. Continental AG PK
Performance |
| Timeline |
| FitLife Brands, Common |
| Continental AG PK |
FitLife Brands, and Continental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FitLife Brands, and Continental
The main advantage of trading using opposite FitLife Brands, and Continental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, Continental 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 Continental will offset losses from the drop in Continental's long position.| FitLife Brands, vs. Kellanova | FitLife Brands, vs. Lamb Weston Holdings | FitLife Brands, vs. Borealis Foods | FitLife Brands, vs. Central Garden Pet |
| Continental vs. Compagnie Gnrale des | Continental vs. Bridgestone Corp ADR | Continental vs. Continental Aktiengesellschaft | Continental vs. Douglas Dynamics |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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