Correlation Between FitLife Brands, and Gap,
Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and Gap, 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 Gap, 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 The Gap,, you can compare the effects of market volatilities on FitLife Brands, and Gap, 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 Gap,. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and Gap,.
Diversification Opportunities for FitLife Brands, and Gap,
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between FitLife and Gap, is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and The Gap, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gap, 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 Gap,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gap, has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Gap, go up and down completely randomly.
Pair Corralation between FitLife Brands, and Gap,
Given the investment horizon of 90 days FitLife Brands, is expected to generate 1.23 times less return on investment than Gap,. But when comparing it to its historical volatility, FitLife Brands, Common is 1.26 times less risky than Gap,. It trades about 0.15 of its potential returns per unit of risk. The Gap, is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,174 in The Gap, on August 29, 2024 and sell it today you would earn a total of 241.00 from holding The Gap, or generate 11.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FitLife Brands, Common vs. The Gap,
Performance |
| Timeline |
| FitLife Brands, Common |
| Gap, |
FitLife Brands, and Gap, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FitLife Brands, and Gap,
The main advantage of trading using opposite FitLife Brands, and Gap, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, Gap, 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 Gap, will offset losses from the drop in Gap,'s long position.| FitLife Brands, vs. Hims Hers Health | FitLife Brands, vs. Procter Gamble | FitLife Brands, vs. Kimberly Clark | FitLife Brands, vs. Colgate Palmolive |
| Gap, vs. Albertsons Companies | Gap, vs. Red Branch Technologies | Gap, vs. Acm Research | Gap, vs. ServiceNow |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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