Correlation Between Seadrill and Xponential Fitness
Can any of the company-specific risk be diversified away by investing in both Seadrill 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 Seadrill and Xponential Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seadrill Limited and Xponential Fitness, you can compare the effects of market volatilities on Seadrill 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 Seadrill with a short position of Xponential Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seadrill and Xponential Fitness.
Diversification Opportunities for Seadrill and Xponential Fitness
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Seadrill and Xponential is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Seadrill Limited and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness and Seadrill 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 Seadrill Limited 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 Seadrill i.e., Seadrill and Xponential Fitness go up and down completely randomly.
Pair Corralation between Seadrill and Xponential Fitness
Given the investment horizon of 90 days Seadrill Limited is expected to generate 0.45 times more return on investment than Xponential Fitness. However, Seadrill Limited is 2.21 times less risky than Xponential Fitness. It trades about 0.03 of its potential returns per unit of risk. Xponential Fitness is currently generating about 0.01 per unit of risk. If you would invest 3,437 in Seadrill Limited on September 4, 2024 and sell it today you would earn a total of 556.00 from holding Seadrill Limited or generate 16.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seadrill Limited vs. Xponential Fitness
Performance |
| Timeline |
| Seadrill Limited |
| Xponential Fitness |
Seadrill and Xponential Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seadrill and Xponential Fitness
The main advantage of trading using opposite Seadrill and Xponential Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seadrill 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.| Seadrill vs. Precision Drilling | Seadrill vs. Sable Offshore Corp | Seadrill vs. Patterson UTI Energy | Seadrill vs. Borr Drilling |
| Xponential Fitness vs. Hyatt Hotels | Xponential Fitness vs. Smart Share Global | Xponential Fitness vs. Sweetgreen | Xponential Fitness vs. Wyndham Hotels Resorts |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |