Correlation Between Nautilus and Peloton Interactive
Can any of the company-specific risk be diversified away by investing in both Nautilus and Peloton Interactive 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 Nautilus and Peloton Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nautilus Group and Peloton Interactive, you can compare the effects of market volatilities on Nautilus and Peloton Interactive 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 Nautilus with a short position of Peloton Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nautilus and Peloton Interactive.
Diversification Opportunities for Nautilus and Peloton Interactive
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nautilus and Peloton is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nautilus Group and Peloton Interactive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peloton Interactive and Nautilus 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 Nautilus Group are associated (or correlated) with Peloton Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peloton Interactive has no effect on the direction of Nautilus i.e., Nautilus and Peloton Interactive go up and down completely randomly.
Pair Corralation between Nautilus and Peloton Interactive
Considering the 90-day investment horizon Nautilus Group is expected to under-perform the Peloton Interactive. But the stock apears to be less risky and, when comparing its historical volatility, Nautilus Group is 1.61 times less risky than Peloton Interactive. The stock trades about -0.08 of its potential returns per unit of risk. The Peloton Interactive is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 933.00 in Peloton Interactive on August 31, 2024 and sell it today you would earn a total of 90.00 from holding Peloton Interactive or generate 9.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 28.24% |
| Values | Daily Returns |
Nautilus Group vs. Peloton Interactive
Performance |
| Timeline |
| Nautilus Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Peloton Interactive |
Nautilus and Peloton Interactive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nautilus and Peloton Interactive
The main advantage of trading using opposite Nautilus and Peloton Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nautilus position performs unexpectedly, Peloton Interactive 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 Peloton Interactive will offset losses from the drop in Peloton Interactive's long position.| Nautilus vs. Xponential Fitness | Nautilus vs. Life Time Group | Nautilus vs. Mattel Inc | Nautilus vs. Bowlero Corp |
| Peloton Interactive vs. Zoom Video Communications | Peloton Interactive vs. DocuSign | Peloton Interactive vs. Pinterest | Peloton Interactive vs. Teladoc |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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