Correlation Between IX Acquisition and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both IX Acquisition and Planet 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 IX Acquisition and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IX Acquisition Corp and Planet Fitness, you can compare the effects of market volatilities on IX Acquisition and Planet 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 IX Acquisition with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of IX Acquisition and Planet Fitness.
Diversification Opportunities for IX Acquisition and Planet Fitness
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between IXAQU and Planet is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding IX Acquisition Corp and Planet Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness and IX Acquisition 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 IX Acquisition Corp are associated (or correlated) with Planet Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Fitness has no effect on the direction of IX Acquisition i.e., IX Acquisition and Planet Fitness go up and down completely randomly.
Pair Corralation between IX Acquisition and Planet Fitness
Assuming the 90 days horizon IX Acquisition is expected to generate 2.61 times less return on investment than Planet Fitness. But when comparing it to its historical volatility, IX Acquisition Corp is 1.28 times less risky than Planet Fitness. It trades about 0.1 of its potential returns per unit of risk. Planet Fitness is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 6,381 in Planet Fitness on September 1, 2024 and sell it today you would earn a total of 3,574 from holding Planet Fitness or generate 56.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 76.98% |
| Values | Daily Returns |
IX Acquisition Corp vs. Planet Fitness
Performance |
| Timeline |
| IX Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Planet Fitness |
IX Acquisition and Planet Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IX Acquisition and Planet Fitness
The main advantage of trading using opposite IX Acquisition and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IX Acquisition position performs unexpectedly, Planet 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 Planet Fitness will offset losses from the drop in Planet Fitness' long position.| IX Acquisition vs. Paysafe | IX Acquisition vs. Cadence Design Systems | IX Acquisition vs. Rumble Inc | IX Acquisition vs. Entegris |
| Planet Fitness vs. The Wendys Co | Planet Fitness vs. Shake Shack | Planet Fitness vs. Papa Johns International | Planet Fitness vs. Darden Restaurants |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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