Correlation Between FitLife Brands, and Origin Materials
Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and Origin Materials 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 Origin Materials 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 Origin Materials, you can compare the effects of market volatilities on FitLife Brands, and Origin Materials 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 Origin Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and Origin Materials.
Diversification Opportunities for FitLife Brands, and Origin Materials
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between FitLife and Origin is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and Origin Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Materials 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 Origin Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Materials has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Origin Materials go up and down completely randomly.
Pair Corralation between FitLife Brands, and Origin Materials
Given the investment horizon of 90 days FitLife Brands, Common is expected to generate 0.81 times more return on investment than Origin Materials. However, FitLife Brands, Common is 1.24 times less risky than Origin Materials. It trades about -0.06 of its potential returns per unit of risk. Origin Materials is currently generating about -0.45 per unit of risk. If you would invest 3,260 in FitLife Brands, Common on November 1, 2024 and sell it today you would lose (99.00) from holding FitLife Brands, Common or give up 3.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FitLife Brands, Common vs. Origin Materials
Performance |
| Timeline |
| FitLife Brands, Common |
| Origin Materials |
FitLife Brands, and Origin Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FitLife Brands, and Origin Materials
The main advantage of trading using opposite FitLife Brands, and Origin Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, Origin Materials 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 Origin Materials will offset losses from the drop in Origin Materials' long position.| FitLife Brands, vs. Noble Romans | FitLife Brands, vs. Greystone Logistics | FitLife Brands, vs. Innovative Food Hldg | FitLife Brands, vs. Galaxy Gaming |
| Origin Materials vs. Tronox Holdings PLC | Origin Materials vs. Valhi Inc | Origin Materials vs. Lsb Industries | Origin Materials vs. Huntsman |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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