Correlation Between FitLife Brands, and Ultra Clean
Can any of the company-specific risk be diversified away by investing in both FitLife Brands, and Ultra Clean 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 Ultra Clean 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 Ultra Clean Holdings, you can compare the effects of market volatilities on FitLife Brands, and Ultra Clean 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 Ultra Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of FitLife Brands, and Ultra Clean.
Diversification Opportunities for FitLife Brands, and Ultra Clean
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between FitLife and Ultra is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding FitLife Brands, Common and Ultra Clean Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultra Clean Holdings 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 Ultra Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultra Clean Holdings has no effect on the direction of FitLife Brands, i.e., FitLife Brands, and Ultra Clean go up and down completely randomly.
Pair Corralation between FitLife Brands, and Ultra Clean
Given the investment horizon of 90 days FitLife Brands, is expected to generate 7.09 times less return on investment than Ultra Clean. But when comparing it to its historical volatility, FitLife Brands, Common is 1.11 times less risky than Ultra Clean. It trades about 0.02 of its potential returns per unit of risk. Ultra Clean Holdings is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,507 in Ultra Clean Holdings on August 25, 2024 and sell it today you would earn a total of 223.00 from holding Ultra Clean Holdings or generate 6.36% 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. Ultra Clean Holdings
Performance |
| Timeline |
| FitLife Brands, Common |
| Ultra Clean Holdings |
FitLife Brands, and Ultra Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FitLife Brands, and Ultra Clean
The main advantage of trading using opposite FitLife Brands, and Ultra Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FitLife Brands, position performs unexpectedly, Ultra Clean 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 Ultra Clean will offset losses from the drop in Ultra Clean's long position.| FitLife Brands, vs. Honest Company | FitLife Brands, vs. Hims Hers Health | FitLife Brands, vs. Procter Gamble | FitLife Brands, vs. Coty Inc |
| Ultra Clean vs. Amtech Systems | Ultra Clean vs. Veeco Instruments | Ultra Clean vs. Cohu Inc | Ultra Clean vs. Onto Innovation |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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