Correlation Between FitLife Brands, and Marchex
Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and Marchex 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 Marchex 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 Marchex, you can compare the effects of market volatilities on FitLife Brands, and Marchex 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 Marchex. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and Marchex.
Diversification Opportunities for FitLife Brands, and Marchex
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between FitLife and Marchex is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and Marchex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marchex 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 Marchex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marchex has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Marchex go up and down completely randomly.
Pair Corralation between FitLife Brands, and Marchex
Given the investment horizon of 90 days FitLife Brands, Common is expected to generate 0.61 times more return on investment than Marchex. However, FitLife Brands, Common is 1.63 times less risky than Marchex. It trades about 0.03 of its potential returns per unit of risk. Marchex is currently generating about -0.05 per unit of risk. If you would invest 3,320 in FitLife Brands, Common on August 29, 2024 and sell it today you would earn a total of 90.00 from holding FitLife Brands, Common or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FitLife Brands, Common vs. Marchex
Performance |
| Timeline |
| FitLife Brands, Common |
| Marchex |
FitLife Brands, and Marchex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FitLife Brands, and Marchex
The main advantage of trading using opposite FitLife Brands, and Marchex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, Marchex 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 Marchex will offset losses from the drop in Marchex's long position.| FitLife Brands, vs. Kellanova | FitLife Brands, vs. Lamb Weston Holdings | FitLife Brands, vs. Borealis Foods | FitLife Brands, vs. Central Garden Pet |
| Marchex vs. Entravision Communications | Marchex vs. Direct Digital Holdings | Marchex vs. Cimpress NV | Marchex vs. Townsquare Media |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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