Correlation Between FitLife Brands, and PACCAR
Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and PACCAR 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 PACCAR 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 PACCAR Inc, you can compare the effects of market volatilities on FitLife Brands, and PACCAR 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 PACCAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and PACCAR.
Diversification Opportunities for FitLife Brands, and PACCAR
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between FitLife and PACCAR is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and PACCAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PACCAR Inc 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 PACCAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PACCAR Inc has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and PACCAR go up and down completely randomly.
Pair Corralation between FitLife Brands, and PACCAR
Given the investment horizon of 90 days FitLife Brands, Common is expected to generate 1.81 times more return on investment than PACCAR. However, FitLife Brands, is 1.81 times more volatile than PACCAR Inc. It trades about 0.09 of its potential returns per unit of risk. PACCAR Inc is currently generating about 0.07 per unit of risk. If you would invest 2,015 in FitLife Brands, Common on September 2, 2024 and sell it today you would earn a total of 1,358 from holding FitLife Brands, Common or generate 67.39% 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. PACCAR Inc
Performance |
| Timeline |
| FitLife Brands, Common |
| PACCAR Inc |
FitLife Brands, and PACCAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FitLife Brands, and PACCAR
The main advantage of trading using opposite FitLife Brands, and PACCAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, PACCAR 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 PACCAR will offset losses from the drop in PACCAR's long position.| FitLife Brands, vs. Seneca Foods Corp | FitLife Brands, vs. Central Garden Pet | FitLife Brands, vs. Central Garden Pet | FitLife Brands, vs. Lifeway Foods |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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