Correlation Between US Global and Xponential Fitness
Can any of the company-specific risk be diversified away by investing in both US Global and Xponential Fitness 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 US Global and Xponential Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Global Investors and Xponential Fitness, you can compare the effects of market volatilities on US Global and Xponential Fitness 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 US Global with a short position of Xponential Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Global and Xponential Fitness.
Diversification Opportunities for US Global and Xponential Fitness
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between GROW and Xponential is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding US Global Investors and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness and US Global 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 US Global Investors are associated (or correlated) with Xponential Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xponential Fitness has no effect on the direction of US Global i.e., US Global and Xponential Fitness go up and down completely randomly.
Pair Corralation between US Global and Xponential Fitness
Given the investment horizon of 90 days US Global Investors is expected to under-perform the Xponential Fitness. But the stock apears to be less risky and, when comparing its historical volatility, US Global Investors is 3.67 times less risky than Xponential Fitness. The stock trades about -0.01 of its potential returns per unit of risk. The Xponential Fitness is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,509 in Xponential Fitness on August 31, 2024 and sell it today you would lose (985.00) from holding Xponential Fitness or give up 39.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US Global Investors vs. Xponential Fitness
Performance |
| Timeline |
| US Global Investors |
| Xponential Fitness |
US Global and Xponential Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Global and Xponential Fitness
The main advantage of trading using opposite US Global and Xponential Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Global position performs unexpectedly, Xponential Fitness 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 Xponential Fitness will offset losses from the drop in Xponential Fitness' long position.| US Global vs. Gladstone Investment | US Global vs. PennantPark Floating Rate | US Global vs. Horizon Technology Finance | US Global vs. Stellus Capital Investment |
| Xponential Fitness vs. Planet Fitness | Xponential Fitness vs. Bowlero Corp | Xponential Fitness vs. JAKKS Pacific | Xponential Fitness vs. Acushnet Holdings Corp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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