Correlation Between Valens and Xponential Fitness
Can any of the company-specific risk be diversified away by investing in both Valens 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 Valens and Xponential Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valens and Xponential Fitness, you can compare the effects of market volatilities on Valens 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 Valens with a short position of Xponential Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valens and Xponential Fitness.
Diversification Opportunities for Valens and Xponential Fitness
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Valens and Xponential is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Valens and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness and Valens 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 Valens 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 Valens i.e., Valens and Xponential Fitness go up and down completely randomly.
Pair Corralation between Valens and Xponential Fitness
Considering the 90-day investment horizon Valens is expected to under-perform the Xponential Fitness. But the stock apears to be less risky and, when comparing its historical volatility, Valens is 1.42 times less risky than Xponential Fitness. The stock trades about -0.03 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 2,240 in Xponential Fitness on September 3, 2024 and sell it today you would lose (690.00) from holding Xponential Fitness or give up 30.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valens vs. Xponential Fitness
Performance |
| Timeline |
| Valens |
| Xponential Fitness |
Valens and Xponential Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valens and Xponential Fitness
The main advantage of trading using opposite Valens and Xponential Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valens 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.| Valens vs. Wolfspeed | Valens vs. GSI Technology | Valens vs. Lattice Semiconductor | Valens vs. ON Semiconductor |
| Xponential Fitness vs. Planet Fitness | Xponential Fitness vs. JAKKS Pacific | Xponential Fitness vs. Mattel Inc | Xponential Fitness vs. OneSpaWorld Holdings |
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 Positions Ratings module to 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.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| 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 | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |