Correlation Between Xponential Fitness and Avient Corp
Can any of the company-specific risk be diversified away by investing in both Xponential Fitness and Avient Corp 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 Xponential Fitness and Avient Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xponential Fitness and Avient Corp, you can compare the effects of market volatilities on Xponential Fitness and Avient Corp 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 Xponential Fitness with a short position of Avient Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xponential Fitness and Avient Corp.
Diversification Opportunities for Xponential Fitness and Avient Corp
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xponential and Avient is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Xponential Fitness and Avient Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avient Corp and Xponential Fitness 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 Xponential Fitness are associated (or correlated) with Avient Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avient Corp has no effect on the direction of Xponential Fitness i.e., Xponential Fitness and Avient Corp go up and down completely randomly.
Pair Corralation between Xponential Fitness and Avient Corp
Given the investment horizon of 90 days Xponential Fitness is expected to generate 3.35 times more return on investment than Avient Corp. However, Xponential Fitness is 3.35 times more volatile than Avient Corp. It trades about 0.14 of its potential returns per unit of risk. Avient Corp is currently generating about 0.13 per unit of risk. If you would invest 1,290 in Xponential Fitness on August 31, 2024 and sell it today you would earn a total of 231.00 from holding Xponential Fitness or generate 17.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xponential Fitness vs. Avient Corp
Performance |
| Timeline |
| Xponential Fitness |
| Avient Corp |
Xponential Fitness and Avient Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xponential Fitness and Avient Corp
The main advantage of trading using opposite Xponential Fitness and Avient Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xponential Fitness position performs unexpectedly, Avient Corp 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 Avient Corp will offset losses from the drop in Avient Corp's long position.| Xponential Fitness vs. Planet Fitness | Xponential Fitness vs. Bowlero Corp | Xponential Fitness vs. JAKKS Pacific | Xponential Fitness vs. Acushnet Holdings Corp |
| Avient Corp vs. Axalta Coating Systems | Avient Corp vs. H B Fuller | Avient Corp vs. Quaker Chemical | Avient Corp vs. Cabot |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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